GAP INC: Earns $189 Million in Quarter Ended October 28GENTEK INC: Earns $2.9 Million in Third Quarter of 2006GLOBAL HOME: Can Use Madeleine's Cash Collateral Until February 28GRANT PRIDECO: Earns $126.5 Million in 2006 Third QuarterHAWAIIAN TELCOM: Posts $43.9 Mil. Net Loss in 2006 Third Quarter

ABRAXAS PETROLEUM: Sept. 30 Balance Sheet Upside-Down by $20.3MM-----------------------------------------------------------------Abraxas Petroleum Corp. reported net income of $589,000 on$13.2 million of revenues for the third quarter ended Sept. 30,2006, compared with a $3.8 million net income on $14.2 million ofrevenues for the same period in 2005.

At Sept. 30, 2006, the company's consolidated balance sheet showed$118.3 million in total assets and $138.7 million in totalliabilities, resulting in a stockholders' deficit of$20.3 million.

The company's consolidated balance sheet at Sept. 30, 2006, alsoshowed strained liquidity with $8.4 million in total currentassets available to pay $11.6 million in total currentliabilities.

During the three months ended Sept. 30, 2006, operating revenuefrom natural gas and crude oil sales decreased by $1.0 millionto $12.8 million compared to $13.8 million during three monthsended Sept. 30, 2005. The decrease in revenue was due to adecrease in the price of natural gas during the third quarter of2006 as compared to the same period of 2005. The decrease inrevenue related to the decline in the natural gas price waspartially offset by increased production and higher pricesreceived for crude oil during the quarter.

The decline in natural gas prices had a negative impact on revenueof approximately $3.7 million. Higher natural gas productioncontributed $2.0 million to revenue and increased crude oilproduction contributed $494,000. The increase in the price ofcrude oil for the quarter ended Sept. 30, 2006 contributed$286,000 to revenue.

Full-text copies of the company's consolidated financialstatements are available for free at:

At the start of 2006, the company anticipated making capitalexpenditures, primarily for the development of its currentproperties, of approximately $40.0 million which was based uponthe anticipated amount of its cash flow from operations andavailability under its revolving credit facility. As natural gasprices have decreased during the first nine months of 2006, cashflow from operations has not reached the levels that it hadanticipated. As a result the company will spend less, between$23 million and $25 million on capital expenditures for 2006.

Headquartered in San Antonio, Texas, Abraxas Petroleum Corp -- http://www.abraxaspetroleum.com/-- is an independent natural gas and crude oil exploitation and production company with operationsconcentrated in Texas and Wyoming. Abraxas was founded in 1977and is publicly traded on the American Stock Exchange under theticker symbol "ABP".

ACCURIDE CORP: Earns $12.4 Mil. Net Income in 2006 Third Quarter----------------------------------------------------------------Accuride Corp., filed its financial statements for the thirdquarter ended Sept. 30, 2006, with the Securities and ExchangeCommission.

The company reported net income of $12.4 million on $341.6 millionof net sales for the quarterly period ended Sept. 30, 2006,compared to net income of $19.1 million on $316.1 million of netsales for the same prior year period.

The increase in net sales is primarily a result of robust demandin the commercial vehicle industry and a partial pass-through ofrising raw material costs.

The decrease in net income was primarily due to lower grossprofit, partially offset by a lower effective tax rate caused by achange in management's estimate regarding the expected realizationof loss carryforwards, an adjustment of tax contingency reservesrelated to federal and state tax matters and certain accrual toreturn adjustments for permanent differences recorded in thequarter. For the quarter ended Sept. 30, 2006, the Companyreported $41.9 million in gross profit compared to a gross profitof $51.5 million for the quarter ended Sept. 30, 2005.

At Sept. 30, 2006, the company's balance sheet showed $1,259million in total assets, $1,016 million in total liabilities, and$242 million in stockholders' equity.

Credit Facility

The Company discloses that it entered into a Fourth Amended andRestated Credit Agreement consisting of:

(1) a new term credit facility in an aggregate principal amount of $550.0 million that will mature on Jan. 31, 2012; and

* the continuation of a $30.0 million Canadian revolving credit facility,

that will terminate on January 31, 2010.

As of Sept. 30, 2006, $374.6 million was outstanding under theTerm B Loan Facility and $5.0 million was outstanding under theNew Revolver. The Term B Loan Facility requires quarterlyamortization payments of $1.4 million that commenced on March 31,2005, with the balance paid on the maturity date for the Term BLoan Facility. As of Sept. 30, 2006, the regularly scheduledpayments due through Dec. 31, 2011 were prepaid without penalty.

The obligations under the Company's new senior credit facilitiesare guaranteed by all of the Company's domestic subsidiaries. Theloans under the new senior credit facilities are secured by, amongother things, a lien on substantially all of the Company's U.S.properties and assets and of its domestic subsidiaries and apledge of 65% of the stock of its foreign subsidiaries. The loansunder the Canadian revolving facility are also secured bysubstantially all of the properties and assets of Accuride CanadaInc.

Full-text copies of the Company's financial statements for thequarterly period ended Sept. 30, 2006, are available for free at:

ADVOCACY AND RESOURCES: Taps Kenneth Williams as Special Counsel----------------------------------------------------------------Michael E. Collins, Esq., the Chapter 11 Trustee appointed inAdvocacy and Resources Corporation's bankruptcy case, asks theHonorable Keith M. Lundin of the U.S. Bankruptcy Court for theMiddle District of Tennessee for authority to employ Kenneth S.Williams, Esq. as his special counsel.

Mr. Williams is expected to:

a. continue the appellate process related to litigation with the U.S. District Attorney over certain pricing issues regarding products subject to the JWOD Act; and

b. assist in the procurement of recovery from the Department of Defense related to certain product subject to Hurricane Katrina and other related price adjustments.

Mr. Collins tells the Court that he proposes to pay Mr. Williamsaccording to a contingency fee agreement among the Debtor, Mr.Williams, and his firm, Madewell, Jared, Halfacre & Williams.Under the agreement, in any legal or financial matters resolvedduring negotiation or administrative process by settlement orfinal ruling agreeable to the Court, the Debtor will pay Mr.Williams a contingency fee equal to 20% of any recovery obtained.

Mr. Williams assures the Court that he is "disinterested" as thatterm is defined in Section 101(14) of the Bankruptcy Code.

Headquartered in Cookeville, Tennessee, Advocacy and ResourcesCorporation is a non-profit corporation that manufactures foodproducts for feeding programs operated by the U.S. Government.Customers include the U.S. Department of Agriculture, theDepartment of Defense, and other private distribution firms.The Company filed for chapter 11 protection on June 20, 2006(Bankr. M.D. Tenn. Case No. 06-03067). Michael E. Collins, Esq.,serves as Chapter 11 Trustee. Manier & Herod, PC, represents Mr.Collins. When the Debtor filed for chapter 11 protection, itestimated assets and debts between $10 million and $50 million.

ALLIED HOLDINGS: Wants Partial Summary Judgment on Volvo Spat-------------------------------------------------------------Allied Holdings, Inc., and its debtor-affiliates ask the U.S.Bankruptcy Court for the Northern District of Georgia to enterpartial summary judgment on their complaint for turnover ofproperty of the estate and violation of the automatic stay againstVolvo Parts North America, Inc.

As reported in the Troubled Company Reporter on April 19, 2006,Allied Automotive Group had asked the Court to compel Volvo toturn over certain funds and prepetition deposits. The Debtorsclaimed that Volvo's continued possession of the funds is anexercise of control over property of the Debtors' estate. Volvoasked the Court to dismiss the adversary proceeding initiated bythe Debtors and, alternatively, demanded a trial by jury.

Volvo has asked the U.S. Bankruptcy Court for the NorthernDistrict of Georgia to enter a summary judgment declaring thatVolvo is entitled to, and did recoup, the overpayments against theaccount balance of Allied Automotive.

Harris B. Winsberg, Esq., at Troutman Sanders LLP, in Atlanta,Georgia, tells the Court that the Debtors are entitled to thereturn of its overpayments because the excess funds that Volvorefuses to turn over were generated by the Debtors' postpetitionoverpayments. The Debtors have a legal and equitable interest inthe Excess Funds, which are clearly property of the bankruptcyestate, Mr. Winsberg says.

Moreover, Mr. Winsberg argues that Volvo is not entitled to recoupthe Excess Funds because, among other things, Volvo never made anypayments to the Debtors and the Excess Funds did not arise out ofthe same transaction as the Debtors' prepetition debt.

ALLIED HOLDINGS: S. Newlin Fights to Have Automatic Stay Lifted---------------------------------------------------------------Stephen G. Newlin asks the U.S. Bankruptcy Court for the NorthernDistrict of Georgia to reconsider the order:

As reported in the Troubled Company Reporter on Oct. 6, 2006, Mr.Newlin asked the Court to lift the automatic stay, to allow him toenforce a judgment against the Debtors' third party insurancecarriers or other non-debtor third parties. He had previouslysought and obtained a default judgment against Allied AutomotiveGroup, Inc., for $1,575,000 on June 21, 2006.

* Mr. Newlin failed to show sufficient "cause" for annulling the automatic stay, to allow him to enforce a $1,575,000 default judgment against the Debtors' third party insurance carriers or other non-debtor third parties;

* no allegation that the Debtors acted in bad faith in filing their bankruptcy cases exists;

* the Debtors have established that allowing Mr. Newlin to collect his $1,500,000 judgment against insurance coverage would impair their ability to obtain the release of restricted cash for their business operations and to fund their reorganization; and

* Mr. Newlin's rights to proceed against the Debtors in an appropriate fashion will not be prejudiced if the stay is not annulled.

Reconsideration

Leon S. Jones, Esq., at Jones & Walden, LLC in Atlanta, Georgia,asserts that neither Mr. Newlin nor his counsel took any actionto levy, collect, or exercise control over the property of theestate.

Mr. Jones contends that the Debtors immediately sought sanctionsfor contempt when more appropriate alternatives were available.Specifically, Mr. Jones continues, the Debtors could have askedthe Court to invalidate the default judgment as to AlliedAutomotive Group, Inc., or taken action under Section 549 of theBankruptcy Code.

Unlike any other creditors or parties asserting personal injuryclaims, Mr. Newlin did not have notice of the bankruptcy to allowhim to timely file a proof of claim or request for relief fromthe automatic stay, Mr. Jones explains.

Mr. Newlin have also repeatedly informed the Debtors that hewould not levy or take any action against them, but rather,pursue third parties.

Since neither Mr. Newlin nor his counsel has ever willfully takenany action to enforce the default judgment against the Debtors orthe Debtors' property, the Court should reconsider its order, Mr.Jones submits.

AMERIDEBT INC: Rebecca Lovell OK'd as Special Business Consultant-----------------------------------------------------------------The U.S. Bankruptcy Court for the District of Maryland inGreenbelt authorized Mark D. Taylor, Esq., the Chapter 11 Trusteeof AmeriDebt Inc. to employ Rebecca Lovell as special businessconsultant, nunc pro tunc to Sept. 1, 2006.

Ms. Lovell was employed by the Debtor from July 2003 to August2006 and was the Debtor's comptroller.

Before the Trustee's appointment, she was responsible for allaccounting functions including, but not limited to:

-- maintaining the Debtor's financial books and records,

-- reviewing accounts payable and receivable,

-- updating the general ledger,

-- supervising outside accountants and other financial professionals, and

-- preparing the payroll.

She also was responsible for managing the Debtor's operating,escrow, and global settlement bank accounts and has beenassembling and preparing all major reports required of achapter 11 debtor.

Since there are no longer any employees at the Debtor, the Trusteesaid he does not wish to expend valuable estate resources on moreexpensive professionals to accomplish these tasks.

Ms. Lovell will assist the Trustee in:

-- administering the estate by providing litigation support, -- maintaining the books of the estate, -- preparing monthly operating reports, and -- performing other services as requested by the Trustee.

Ms. Lovell will bill at $50 per hour.

To the best of the Trustee's knowledge, Ms. Lovell isdisinterested pursuant to Section 101(14) of the Bankruptcy Code.

Headquartered in Germantown, Maryland, AmeriDebt, Inc. --http://ameridebt.org/-- is a credit counseling company. The Company filed for chapter 11 protection on June 5, 2004 (Bankr. D.Md. Case No. 04-23649). When the Company filed for protectionfrom its creditors, it listed $8,387,748 in total assets and$12,362,695 in total debts. The Bankruptcy Court appointed MarkD. Taylor, Esq., as the Debtor' chapter 11 trustee on Sept. 20,2004. Arent Fox PLLC represents Mr. Taylor.

B/E AEROSPACE: Earns $31.4 Million in 2006 Third Quarter---------------------------------------------------------B/E Aerospace Inc. reported a $31.4 million net income on$287.9 million of net sales for the quarter ended Sept. 30, 2006,compared with a $10 million net income on $217.1 million of netsales for the same period in 2005.

At Sept. 30, 2006, the company's balance sheet showed$1.46 billion in total assets, $795.6 million in totalliabilities, and $668.8 million in total stockholders' equity.

Gross profit for the third quarter of 2006 of $100.8 million, or35.0% of sales, increased by $24.2 million or 31.6%, as comparedto the same period last year.

Based in Wellington, Florida, B/E Aerospace, Inc. (Nasdaq:BEAV)-- http://www.beaerospace.com/-- manufactures aircraft cabin interior products, and is an aftermarket distributor of aerospacefasteners. B/E designs, develops and manufactures a broad rangeof products for both commercial aircraft and business jets. B/Emanufactured products include aircraft cabin seating, lighting,oxygen, and food and beverage preparation and storage equipment.The company also provides cabin interior design, reconfigurationand passenger-to-freighter conversion services. B/E sells andsupports its products through its own global direct sales andproduct support organization.

* * *

As reported in the Troubled Company Reporter on Oct. 3, 2006,Moody's Investors Service affirmed its B1 Corporate Family Ratingfor B/E Aerospace, Inc., in connection with its new Probability-of-Default and Loss-Given-Default rating methodology. Moody'salso affirmed its Ba3 probability-of-default rating to B/EAerospace, Inc.'s Senior Secured Revolving Credit Facility due2011.

BIO-RAD LABS: Earns $23.1 Million in Quarter Ended September 30---------------------------------------------------------------Bio-Rad Laboratories Inc. reported $23.1 million of net income on$304.7 million of net revenues for the three months ended Sept.30, 2006, compared to $16.2 million of net income on$283.2 million of net revenues for the same period in 2005.

At Sept. 30, 2006, the company's balance sheet showed $1.5 billionin total assets and $738.8 million in total liabilities.

As of Sept. 30, 2006, the Company had $238.4 million in cash andcash equivalents. The Company also had $29.2 million availableunder international lines of credit and $243.2 million of short-term investments. Under the $150.0 million restated and amendedRevolving Credit Facility, the Company has $145.6 millionavailable with $4.4 million reserved for standby letters of creditissued by the company's banks to guarantee its obligations tocertain insurance companies related to the deductible on the co-insurance provision of policies issued for the company as thebeneficiary.

On Aug. 14, 2006, Bio-Rad signed a definitive agreement to acquireCiphergen Biosystems, Inc.'s ProteinChip Systems(R) business andworldwide technology rights to the Surface Enhanced LaserDesorption/Ionization (SELDI-TOF-MS) for approximately $20 millionin cash. The acquisition will include certain product lines,manufacturing capability, and intellectual property as well asaccess to Ciphergen's life science customer base. In addition,Bio-Rad will make a $3 million equity investment in Ciphergen.

In October 2006, Bio-Rad completed the acquisition of BlackhawkBioSystems Inc. for approximately $17 million. Blackhawk is aprovider of quality control products used in infectious diseasetesting. With the acquisition of the Blackhawk infectious diseasecontrols, we will be able to offer a broader line of qualitycontrol products for the clinical laboratory. This acquisitionwill be included in the Clinical Diagnostics segment.

About Bio-Rad Laboratories

Bio-Rad Laboratories, Inc. (AMEX: BIO) (AMEX: BIOb) -- http://www.bio-rad.com/-- is a multinational manufacturer and distributor of life science research products and clinicaldiagnostics. Based in Hercules, California, Bio-Rad serves morethan 70,000 research and industry customers worldwide through anetwork of more than 30 wholly owned subsidiary offices.

* * *

As reported in the Troubled Company Reporter on Oct. 12, 2006,Moody's Investors Service confirmed its Ba2 Corporate FamilyRating for Bio-Rad Laboratories Inc. in connection with itsimplementation of its new Probability-of-Default and Loss-Given-Default rating methodology.

BOWNE & CO: Incurs $11.7 Mil. Net Loss in Quarter Ended Sept. 30----------------------------------------------------------------Bowne & Co. Inc. posted an $11.7 million net loss on$175.1 million of net revenues for the three months ended Sept.30, 2006, in contrast to a $2.3 million net income on$152.3 million of net revenues for the same period in 2005.

At Sept. 30, 2006, the company's balance sheet showed $517.5billion in total assets and $252.9 million in total liabilities.

"Our sharpened focus on our core businesses is paying off, asdemonstrated by our strongest third quarter in six years," saidBowne Chairman and Chief Executive Officer Philip E. Kucera."We've accelerated the integration of Marketing & BusinessCommunications and we continue to be optimistic about its futureperformance."

"This was another strong quarter for Bowne," added David J. Shea,Bowne President and Chief Operating Officer. "We're particularlypleased with Financial Print's gains in transactional market sharedespite a decline in market activity in the third quarter. Webelieve the strategic decisions we've made in 2006 position uswell for 2007 in all of the markets we serve."

Discontinued Operations

During the quarter the Company completed the sale ofDecisionQuest. The 2006 third quarter loss of $12.1 million fromdiscontinued operations includes the $5.1 million loss, net oftax, from the sale, and a $4.9 million charge, net of tax, for thecosts associated with exiting the leased facilities ofDecisionQuest and Bowne Business Solutions. The year-to-dateloss, net of tax, of $15.9 million includes the aforementioneditems, a $6.0 million gain, net of tax, on the sale of CaseSoft, ajoint venture investment held by DecisionQuest which was sold inMay 2006, and a $10.0 million goodwill impairment charge, net oftax, recorded in the second quarter related to DecisionQuest.

About Bowne & Co.

Based in New York City, Bowne & Co., Inc. (NYSE: BNE)-- http://www.bowne.com/-- is a printing company, which specializes in financial documents such as prospectuses, annualand interim reports, and other paperwork required by the SEC.Bowne also handles electronic filings via the SEC's EDGAR systemand provides electronic distribution and high-volume mailingservices. The financial printing business accounts for the bulkof the company's sales. Bowne also offers marketing and businesscommunications services and litigation support software. TheCompany has 3,500 employees in 78 offices around the globe.

CALPINE CORPORATION: Wants PMCC Settlement Agreement Approved-------------------------------------------------------------Calpine Corp. and its debtor-affiliates ask the U.S. BankruptcyCourt for the Southern District of New York to approve theirSettlement Agreement with PMCC Calpine New England Investment, LLCand PMCC Calpine NEIM, LLC.

As of Dec. 20, 2005 Date, Debtors Rumford Power Associates LimitedPartnership and Tiverton Power Associates Limited Partnershipowned certain real property located in Rumford, Maine, andTiverton, Rhode Island. Pursuant to a leveraged leasetransaction, Rumford and Tiverton were also parties to certainground and facility leases related to two gas-fired combined cycleelectric generating facilities located on their own realproperties. Under the Leases, Rumford and Tiverton leased realproperties to PMCC Calpine New England Investment, LLC, who inturn leased the Power Plants to the Debtors.

In addition to the Leases, the parties entered into a series ofother agreements governing the leveraged lease transaction,including:

* a participation agreement, which governed many of the rights and obligations of the parties to the leveraged lease transaction; and

In connection with the leveraged lease transaction, PMCCInvestment, as the Owner Lessor, entered into an indenture,pursuant to which PMCC Investment issued two notes -- one relatedto each of the Power Plants. The Lessor Notes are held by onepass through trust, which is currently administered by U.S. BankNational Association.

In June 2006, the Court authorized the Debtors to transfer assetsnecessary for the operation of the Rumford and Tiverton electricgenerating power plants to a receiver, Bennett L. Spiegel, Esq.,at Kirkland & Ellis LLP, in New York, relates.

The Court also set Feb. 6, 2006, as the effective rejection dateof the Lease Agreements among the Debtors, PMCC Investment andPMCC NEIM.

Three weeks after, the Debtors sought to reject the remainingexecutory contracts associated with the Rumford and Tivertonleveraged lease transaction. PMCC NEIM objected to the RejectionNotice, particularly the rejection of the Tax IndemnityAgreements.

Subsequently, PMCC NEIM filed 11 proofs of claim for more than$200,000,000 against Rumford and Tiverton and against CalpineCorporation, in respect of its guaranty obligations to Rumfordand Tiverton.

The Debtors and the Official Committee of Unsecured Creditorsbelieve that grounds exist to challenge the Claims and that manyof those challenges would be resolved in favor of the Debtors.The claims litigation, however, would require both the Debtorsand the Creditors Committee to expend significant time and estateresources to analyze and to object to the Settled Claims.

Absent the proposed settlement, the Debtors believe that PMCCNEIM would continue to assert claims for more than $17,500,000.Moreover, the length of time and expense involved with litigatingthe Settled Claims would turn a threatened litigation that can beresolved amicably between the parties into a multiple year battle,Mr. Spiegel says.

Headquartered in San Jose, California, Calpine Corporation(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient,natural gas-fired and geothermal power plants. Calpine owns,leases and operates integrated systems of plants in 21 U.S. statesand in three Canadian provinces. Its customized products andservices include wholesale and retail electricity, gas turbinecomponents and services, energy management and a wide range ofpower plant engineering, construction and maintenance andoperational services.

The company previously produced a portion of its fuel consumptionrequirements from its own natural gas reserves. However, in July2005, the company sold substantially all of its remaining domesticoil and gas assets to Rosetta Resources Inc.

CALPINE CORP: Sell Turbines to Consorcio Pacific for $48 Million----------------------------------------------------------------The U.S. Bankruptcy Court for the Southern District of New Yorkauthorized Calpine Corp. and its debtor-affiliates to sell fourSiemens Power Generation Model Econopac combustion turbines toConsorcio Pacific Rim Energy Yucal Placer HTE for $48,000,000.

As reported in the Troubled Company Reporter on Oct. 24, 2006,the Siemens Power Generation Model Econopac combustion turbinesare surplus equipment and remain unused and in storage in NorthLas Vegas, Nevada, and Charlotte, North Carolina, Bennett L.Spiegel, Esq., at Kirkland & Ellis LLP, in New York, tells theCourt.

Mr. Spiegel adds that the Debtors also do not have anyprospective projects in which the Turbines are likely to beutilized in the near future.

As part of their business operations, the Debtors engagedmarketing and sale efforts to dispose of the Siemens Turbines.Mr. Spiegel relates that since the Dec. 20, 2005 Petition Date,the Debtors have received offers for the Turbines from severalinterested purchasers. Some of the Offers sought to purchasemultiple turbines, while others sought to purchase both turbinesand other equipment in bulk.

After a review of the Offers, the Debtors, in consultation withthe Official Committee of Unsecured Creditors and the UnofficialCommittee of Second Lien Debtholders, determined that the Offerproposed by Consorcio Pacific is the highest and best offer.

Consequently, the Debtors and Consorcio Pacific entered into aPurchase and Sale Agreement, which provides that:

(a) Consorcio Pacific will pay the Debtors $48,000,000, in the aggregate, for the four Turbines;

(b) After signing the PSA, Consorcio Pacific will deliver a $4,800,000 deposit to the Union Bank of California to be held in an escrow account;

(c) The assets include, among other things, the four Siemens turbines, and all equipment and materials, written contracts, books and records related to them. Each of the four turbine packages consists of a generator, a combustion turbine and other miscellaneous related equipment;

(d) Consorcio Pacific will pay all excise taxes imposed by any government authority with respect to the sale of the Turbines;

(e) In the event of a material loss or damage to the Turbines, the Debtors will report to Consorcio Pacific that material loss in detail.

If the Material Loss is up to $1,000,000 on one Turbine Or up to $2,000,000 in the aggregate for all Turbines, Consorcio Pacific will proceed to Closing on all Turbines that have not suffered a material loss and the Debtors will have to repair or replace the loss on any Affected Turbine. If the Debtors are unable to repair the Affected Turbine, Consorcio Pacific will have the right to elect not to purchase the Unrepaired Turbine.

If the Material Loss is greater than $1,000,000 on one Turbine and up to $2,000,000 in the aggregate for all Turbines, Consorcio Pacific will have the right to decline purchase of the Turbines;

(f) The Debtors will maintain and store the Turbines until the applicable Closing;

(g) Consorcio Pacific will have the sole responsibility of procuring any missing items if the missing item costs less than $10,000. If the missing item costs more than $10,000, the Debtors will have to procure that missing item;

(h) If the Debtors enter into an alternative transaction with another bidder other than Consorcio Pacific, Consorcio Pacific will receive a $880,000 Break-Up Fee. The payment of the Break-Up Fee will constitute an allowed administrative expense of the Debtors' estate, and will be paid from the deposit or other proceeds of the Alternative Transaction.

Headquartered in San Jose, California, Calpine Corporation(OTC Pink Sheets: CPNLQ) -- http://www.calpine.com/-- supplies customers and communities with electricity from clean, efficient,natural gas-fired and geothermal power plants. Calpine owns,leases and operates integrated systems of plants in 21 U.S. statesand in three Canadian provinces. Its customized products andservices include wholesale and retail electricity, gas turbinecomponents and services, energy management and a wide range ofpower plant engineering, construction and maintenance andoperational services.

The company previously produced a portion of its fuel consumptionrequirements from its own natural gas reserves. However, in July2005, the company sold substantially all of its remaining domesticoil and gas assets to Rosetta Resources Inc.

CALYPTE BIOMEDICAL: Sept. 30 Balance Sheet Upside-Down by $7.2MM----------------------------------------------------------------Calypte Biomedical Corp reported a $4.2 million net loss on$68,000 of revenues for the third quarter ended Sept. 30, 2006,compared with a $3 million net loss on $166,000 of revenues forthe same period in 2005.

The increase in net loss for the quarter ended Sept. 30, 2006 wasprimarily due to the increase in net interest expense to $3.1 million in the third quarter of 2006, compared with the netinterest expense of $1.1 million in the third quarter of 2005.

At Sept. 30, 2006, the Company's balance sheet showed $8.5 millionin total assets and $15.6 million in total liabilities, resultingin a $7.2 million total stockholders' deficit. Additionally,accumulated deficit at Sept. 30, 2006 stood at $165.3 million.

The Company's balance sheet at Sept. 30, 2006, also showedstrained liquidity with $1.2 million in total current assetsavailable to pay $11.9 million in total current liabilities.

The company's $1.3 million loss from operations for the thirdquarter of 2006 reflects a 7% decrease compared with the$1.4 million loss from continuing operations reported for thethird quarter of 2005.

As reported in the Troubled Company Reporter on May 1, 2006,Odenberg, Ullakko, Muranishi & Co. LLP, expressed substantialdoubt about Calypte Biomedical Corporation's ability to continueas a going concern after it audited the company's financialstatement for the year ended Dec. 31, 2005. The auditing firmpoints to the company's recurring losses from operations andnegative cash flows.

CARRAWAY METHODIST: Cabaniss Johnston Approved as Special Counsel-----------------------------------------------------------------The Honorable Tamara O. Mitchell of the U.S. Bankruptcy Court forthe Northern District of Alabama in Birmingham authorized CarrawayMethodist Health Systems and its debtor-affiliates to employCabaniss, Johnston, Gardner, Dumas & O'Neal as their specialcorporate counsel.

As reported in the Troubled Company Reporter on Oct. 3, 2006,Cabaniss Johnston will:

a. represent the Debtors in general corporate matters, including the closing of the sale, and to prepare related necessary resolutions, minutes, contracts, reports, pleadings and other legal documents, including an Asset Purchase Agreement and related documents; and

b. represent the Debtors in all other matters arising out of the Debtors' operations, including, without limitation, healthcare, litigation, ERISA, tax, labor and employment, real estate, and environmental matters.

CATHOLIC CHURCH: Portland's FCR Can't Represent Indiv. Claimants----------------------------------------------------------------The U.S. Bankruptcy Court for the District of Oregon rules thatthe Future Claimants Representative has no power or duty torepresent particular individuals who assert that they are membersof the class of Future Claimants or to make available to thoseindividuals attorneys or other professionals.

The Court says that the primary duty of the Future ClaimantsRepresentative is to represent the collective interests of theFuture Claimants as a class with regard to their child abuseclaims against the Archdiocese of Portland.

Each individual who asserts that he or she is a Future Claimant isresponsible for liquidating or settling, at his or her ownexpense, his or her child abuse claim against Archdiocese.

Prior to the Court's ruling, David A. Foraker, Esq., at Greene &Markley, P.C., in Portland, Oregon, in his capacity as legalrepresentative of future claimants in the Chapter 11 case of theArchdiocese of Portland in Oregon, asks the U.S. Bankruptcy Courtfor the District of Oregon for guidance regarding his powers andduties with respect to individuals who assert that they are"Future Claimants."

Specifically, but without limitation, Mr. Foraker asks JudgePerris to determine whether and, if so, the extent to which he hasa duty to provide or make available to a member of hisconstituency legal representation that is specific to thatindividual.

Mr. Foraker says he does not know what he should do and what hecan do with regard to a request for an attorney made by Jerald R.Laskey, who asserts that he is a future claimant. Mr. Forakernotes that the FCR Appointment Order does not specifically dealwith or address that issue.

Mr. Foraker relates that he has solicited input from theArchdiocese with regard to the matter, but those efforts to find amutually satisfactory solution were unsuccessful.

Mr. Foraker says the Court's clarification on the issue isimportant to assist him in dealing with requests for assistancemade by persons who assert that they are future claimants.

Portland Responds

Representing the Archdiocese, Thomas W. Stilley, Esq., at SussmanShank LLP, in Portland, Oregon, tells Judge Perris that the FCR'sduties are to the collective interests of all the FutureClaimants; he cannot and should not represent any individualFuture Claimant or advocate on behalf of any individual FutureClaimant whose interest might be contrary to the collectiveinterests of all Future Claimants.

Mr. Laskey and all other future claimants should be required toretain their own counsel, Mr. Stilley contends. Portland isunaware of any authority that would permit the Court to appoint anattorney for any Future Claimant at the estate's expense.

Mr. Stilley notes that the there are many pro se tort claimants inPortland's case, many of whom have resolved their claims with theArchdiocese.

Bankruptcy cases are replete with creditors who are unable toobtain counsel and who prosecute their own claims, either becauseno attorney is willing to represent them or because they choose toproceed without counsel, Mr. Stilley reminds the Court. Noexception should be made for any similarly situated individualssimply because they allege to be Future Claimants and the FCR isconcerned that he may have a duty to provide them withrepresentation, Mr. Stilley argues.

Portland suggests that any Future Claimant who comes forwardshould be required to file a claim. "That will permit the[Archdiocese] to determine whether to file an objection to theclaim and will permit the claims allowance process to proceed,"Mr. Stilley explains.

The Archdiocese of Portland in Oregon filed for chapter 11protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.Thomas W. Stilley, Esq., and William N. Stiles, Esq., at SussmanShank LLP, represent the Portland Archdiocese in its restructuringefforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, representsthe Official Tort Claimants Committee in Portland, and scores ofabuse victims are represented by other lawyers. David A. Forakerserves as the Future Claimants Representative appointed in theArchdiocese of Portland's Chapter 11 case. In its Schedules ofAssets and Liabilities filed with the Court on July 30, 2004, thePortland Archdiocese reports $19,251,558 in assets and$373,015,566 in liabilities. (Catholic Church Bankruptcy News,Issue No. 73; Bankruptcy Creditors' Service, Inc.,http://bankrupt.com/newsstand/or 215/945-7000)

CATHOLIC CHURCH: Tucson Wants Immaculate Heart Sisters Pact Okayed------------------------------------------------------------------The Diocese of Tucson asks the U.S. Bankruptcy Court for theDistrict of Arizona to approve the Settlement Agreement with theSisters of the Immaculate Heart of Mary, Inc. Tucson believesthat the Settlement is in the best interest of its estate andcreditors.

The Diocese of Tucson and the Immaculate Heart Sisters havedisputes over certain claims for indemnity and contributionrelated to alleged tort claims on account of sexual abuse bypriests or brothers associated with the Immaculate Heart Sisterswho worked in the Diocese. The Tucson Diocese and the ImmaculateHeart Sisters are co-defendants in certain litigation involvingclergy abuse.

After arm's-length negotiations, the Diocese and the ImmaculateHeart Sisters agreed to settle the dispute. In consideration ofbeing treated as a Participating Third Party and a Released Partyunder the Diocese's confirmed Chapter 11 Plan, the ImmaculateHeart Sisters will contribute $50,000 in five equal annualinstallments to the Settlement Trust established under the Plan.

The Immaculate Heart Sisters will pay a 10% interest in the eventit fails to timely make the payments.

The parties execute mutual releases. If, contrary to the parties'specific intent, any claims released include claims that aredeemed for any reason to survive the agreement and the Planeffective date, the parties forever waive entitlement to and agreenot to assert those claims.

CHENIERE ENERGY: Posts $33.1 Million Loss in 2006 Third Quarter----------------------------------------------------------------Cheniere Energy reported a $33.1 million net loss on $737,000 ofrevenues for the quarter ended Sept. 30, 2006, compared with an$8 million net income on $729,000 of revenues for the same periodin 2005.

At Sept. 30, 2006, the company's balance sheet showed $1.6 billionin total assets, $1.4 billion in total liabilities, and ]$218 million in total stockholders' equity. Additionally,accumulated deficit stood at $153.8 million at Sept. 30, 2006.

The major factors contributing to the $33.1 million 2006 thirdquarter net loss were:

These factors were partially offset by interest income of$11.1 million.

Liquidity and Capital Resources

The Company relates that its three LNG receiving terminalprojects, as well as its related proposed natural gas pipelines,will require significant amounts of capital and are subject torisks and delays in completion. In addition, the Company saysthat its marketing business will need a substantial amount ofcapital for hiring employees, satisfying creditworthinessrequirements of contracts and developing the systems necessary toimplement its business strategy.

The Company notes however that even if successfully completed andimplemented, the LNG-related business activities are not expectedto begin to operate and generate cash flows before the firstquarter of 2008, at the earliest.

The company currently estimates that the cost of completing itsthree LNG receiving terminals will be approximately $3 billion,before financing costs. In addition, it expects that capitalexpenditures of approximately $800 million to $1 billion will berequired to construct its three related natural gas pipelines.

As of September 30, 2006, the company had working capital of$681.6 million but must be augmented with significant additionalfunds in order to carry out its long-term business plan. TheCompany currently expects that its capital requirements will befinanced in part through cash on hand, issuances of project-leveldebt, equity or a combination of the two and in part with netproceeds of debt or equity securities issued by Cheniere or itssubsidiaries or other borrowings.

Full-text copies of the company's consolidated third quarterfinancial statements are available for free at:

Based in Houston, Texas, Cheniere Energy Inc. (AMEX:LNG) operatesa network of three, 100% owned, onshore LNG receiving terminals,and related natural gas pipelines, along the Gulf Coast of theUnited States. The company is in the early stages of developing abusiness to market LNG and natural gas. To a limited extent, it isalso engaged in oil and natural gas exploration and developmentactivities in the Gulf of Mexico. The company operates fourbusiness segments: LNG receiving terminal, natural gas pipeline,LNG and natural gas marketing, and oil and gas exploration anddevelopment.

AS reported in the Troubled Company Reporter on Nov. 17, 2006, theCompany accepted the $26.7 billion buyout offer from Bain Capital.

The class action, which charges the Company with breaching theirfiduciary duties by agreeing to sell the Company to Mays family,and two private equity firms, was filed Thursday, November 23, inthe District Court for the 166th Judicial District in BexarCounty.

The lawsuit disclosed that the defendants "are acting contrary totheir fiduciary duty to maximize value on a change in control ofthe company," the Reuters says.

The lawsuit added a statement that the deal is unfair "because itwill take Clear Channel private at a wholly inadequate price, theproposed transaction will, for inadequate consideration, deny theplaintiff and other members of the class the opportunity to shareproportionately in the future success of the company and itsvaluable assets."

The plaintiff Lou Ann Murphy, according to Reuters, sought aninjunction against the deal, or damages should the transaction becompleted.

Pursuant to the takeover deal, the Company can still solicit otherbids through Dec. 7, and negotiate until Jan. 5, 2006.

San Antonio, Texas-based Clear Channel Communications, Inc.(NYSE: CCU) -- http://www.clearchannel.com/-- is a media and entertainment company specializing in "gone from home"entertainment and information services for local communities andpremiere opportunities for advertisers. The company's businessesinclude radio, television and outdoor displays.

* * *

As reported in the Troubled Company Reporter on Nov. 17, 2006,Standard & Poor's Ratings Services lowered its corporate creditand senior unsecured debt ratings on Clear Channel CommunicationsInc. to 'BB+' from 'BBB-'. The ratings remain on CreditWatch withnegative implications, where they were placed on Oct. 26, 2006,following the company's announcement that it was exploringstrategic alternatives to enhance shareholder value.

As reported in the Troubled Company Reporter on Nov. 17, 2006,Fitch Ratings downgraded Clear Channel Communications Inc.'sratings at Issuer Default Rating to 'BB-' from 'BBB-'; and Seniorunsecured to 'BB-' from 'BBB-'. The ratings remain on RatingWatch Negative.

As reported in the Troubled Company Reporter on Oct. 30, 2006,Moody's Investors Service placed the (P)Ba2 Multiple SeniorityShelf Rating for Clear Channel Communications Inc. on review forpossible downgrade.

COI MIDWEST: Has Until March 27 to File Chapter 11 Plan-------------------------------------------------------The U.S. Bankruptcy Court for the Central District of Californiaextends until March 27, 2007, the period within which COI MidwestInvestments LLC has the exclusive right to file a chapter 11 planof reorganization. The Court also extends the time to solicitacceptances of that plan to May 26, 2007.

As reported in the Troubled Company Reporter on Oct. 6, 2006, theDebtor explained that during the first two to three months of itschapter 11 case, it devoted substantial time to negotiate a saleagreement with Prime Measurement Products, Inc. In addition, theDebtor says it has been working diligently to hire the necessaryprofessionals in order to prepare the property for sale.

The Debtor says that the property will be ready for marketing inthe first quarter of 2007 and that the extension will give it moretime to prepare a successful disclosure statement and provide ameaningful distribution to creditors and equity holders as aresult of the property sale.

Headquartered in the City of Industry, California, COI MidwestInvestments LLC leases its real property in Canyon Road. TheCompany filed for bankruptcy protection on June 1, 2006 (Bankr.C.D. Calif. Case No. 06-12329). Ron Bender, Esq., and David B.Golubchik, Esq., at Levene, Neale, Bender, Rankin & Brill, LLP,represent the Debtor in its restructuring efforts. When theDebtor filed for bankruptcy, it reported assets amounting between$10 million and $50 million and debts aggregating between$1 million and $10 million.

COMMUNITY HEALTH: Earns $8.2 Million in Third Quarter of 2006-------------------------------------------------------------Community Health Systems, Inc., reported net income of$8.2 million on $1.1 billion of net operating revenues for thequarter ended Sept. 30, 2006, compared with a $42.9 million netincome on $929.3 million of net operating revenues for the sameperiod in 2005.

The 20.9% increase in net operating revenues was due to increasesin both admissions and surgical volume.

The Company discloses that it increased its allowance for baddoubtful accounts by $65 million for the quarter ended Sept. 30,2006, in order to reflect lower cash collection which the companyexperienced during the quarter ended Sept. 30, 2006 from self-payaccounts.

After taking into account the effect of the change in estimate ofallowance for doubtful accounts, the company generated$8.2 million in income from continuing operations, a decline of81.3% over the three months ended Sept. 30, 2005.

Operating expenses, as a percentage of net operating revenues,increased from 85.2% for the third quarter ended Sept. 30, 2005 to91.9% for the third quarter ended Sept. 30, 2006, mainly due tothe increase in the provision for bad debts and increased salariesand benefits paid.

On Aug. 19, 2004, the Company entered into a $1.625 billion seniorsecured credit facility, consisting of a $1.2 billion term loanwith a final maturity in 2011 and a $425 million revolving tranchethat matures in 2009, with a consortium of lenders which wassubsequently amended on Dec. 16, 2004 and July 8, 2005.

As of Sept. 30, 2006, available additional borrowings under therevolving credit facility was $153 million, of which $21 millionis set aside for outstanding letters of credit. The Company mayalso add up to $200 million of borrowing capacity from receivabletransactions, including securitizations, under its senior securedcredit facility which has not yet been accessed, and an additionalone or more tranches of term loans in the aggregate principalamount of $400 million.

About Community Health

With a portfolio of 76 hospitals in 22 states, Community HealthSystems, Inc., is the largest non-urban provider of generalhealthcare services in the United States in terms of number offacilities and net operating revenues. The company concentratesits operations in rural markets where in 85% of them, they are thesole provider. The company provides a broad range of generalhospital healthcare services to patients in the communities inwhich it is located.

* * *

As reported in the Troubled Company Reporter on Oct. 19, 2006,Fitch affirmed its 'BB' rating for both the company's IssuerDefault and Senior secured bank facility, and a 'B+' rating on thecompany's Senior subordinated notes. The Rating Outlook isStable.

As reported in the Troubled Company Reporter on Oct. 2, 2006,Moody's Investors Service affirmed its 'Ba3' Corporate FamilyRating for Community Health Systems, Inc. and its 'B2' rating onthe company's $250 million issue of 6.5% senior subordinated notesdue 2012, in connection with its implementation of the newProbability-of-Default and Loss-Given-Default rating methodologyfor the U.S. Hospital and Long-term Care sectors. Moody's alsoassigned an LGD6 rating to those bonds, suggesting noteholderswill experience a 92% loss in the event of default.

COMPLETE RETREATS: Wants to Sell Substantially All Assets for $98M------------------------------------------------------------------Complete Retreats LLC and its debtor-affiliates seek the U.S.Bankruptcy Court for the District of Connecticut's authority tosell substantially all of their assets to Ultimate Resort LLC for$98,000,000, free and clear of all liens, claims and encumbrances.

After exploring a variety of strategic alternatives, the Debtorsascertained that they are not able to sustain further losses onoperations while a formal reorganization process takes place,Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut,relates. The Debtors thus concluded that a prompt sale ofsubstantially all of their assets is the optimal means ofpreserving value in the Chapter 11 cases for the benefit of allparties-in-interest.

To that end, the Debtors extensively marketed their assets,negotiated with multiple potential investors and buyers, andconducted a private auction of their assets among the parties whohad submitted the three best offers.

Accordingly, in consultation with the support of the OfficialCommittee of Unsecured Creditors, the Debtors have determinedthat Ultimate Resort's offer is the highest and best bid for theAssets.

Pursuant to an asset purchase agreement between the parties,Ultimate Resort will acquire most of the Debtors' assets,properties, assumed executory contracts and unexpired leases, andrights, in exchange for cash consideration.

A list of the Debtors' Domestic and Foreign Properties thatUltimate Resort will acquire is available for free at:

The Acquired Assets do not include any of the Debtors' right,title and interest in, among others, all in force director andofficer insurance policies, capital stock or equivalent ownershipinterests of the Debtors, amounts due to the Debtors from anyother Debtor, certain real property and inventory, certaincontracts and leases, and the Existing Membership Contracts.

(2) liabilities and obligations arising out of the Assumed Contracts and all cure costs;

(3) liabilities and obligations occurring on or after the Closing Date relating to or arising out of the Acquired Assets, the Assumed Liabilities, or the Debtors' business;

(4) existing reservations of the Debtors' members who will accept new membership Contracts with respect to the Acquired Real Properties and, to the extent possible upon Ultimate Resort's commercially reasonable efforts to accommodate the requests, the existing reservations of members accepting new membership contracts with respect to those properties not included in the Acquired Assets that can be transferred to other Properties owned by Ultimate Resort;

(5) liabilities and obligations under the New Membership Contracts; and

(6) liabilities and obligations arising from the severance of any of the Debtors' employees on or after the effective date of the Sale up to $100,000.

The Debtors will retain all liabilities and obligations relatingto (i) any environmental, health, or safety matter to the extentoccurring prior to the Closing Date, and (ii) all present andformer stockholders and members to the extent arising from facts,events or circumstances occurring prior to the Closing Date.

The Debtors and Ultimate Resort will negotiate in good faithtoward a management contract, which will provide that if theClosing has not occurred by December 29, 2006, Ultimate Resortwill assume management of the Debtors' businesses and thereafterwill fund any operating expenses and retain any operatingrevenues.

Prior to the Closing Date, Ultimate Resort will offer employmentto all of the Debtors' employees who agree to forever waive,release, and discharge to the fullest extent permitted by law theDebtors from any and all claims, causes of action, and damages.The offered employment will be on terms and conditionssubstantially similar to those that exist as of the Closing Date.

Buyer Protections

According to Mr. Daman, Ultimate Resort is concerned that anotherparty may submit a proposal prior to the Sale Hearing to purchasethe Acquired Assets for higher consideration than it would beable to provide, and that the Debtors, in the exercise of theirfiduciary duties, may feel compelled to accept that higher offerand terminate the APA.

Ultimate Resort has thus consented to keep its offer open throughthe Sale Hearing, provided that in the event the APA isterminated in favor of an alternative transaction:

-- the Debtors will pay Ultimate Resort a $2,500,000 break-up fee in the event the APA is terminated in favor of an alterative transaction; and

-- the Debtors will reimburse Ultimate Resort up to $600,000 for reasonable, out-of-pocket costs and expenses it incurred in connection with the negotiation, execution, or consummation.

Membership Offer in Ultimate Resort

As part of the Sale, Ultimate Resort has agreed to independentlyoffer to each of the Debtors' destination club members amembership contract after the Closing of the Sale.

Under a New Membership Contract, an Offeree could become a memberof Ultimate Resort under these terms and conditions:

A. Existing members of the Private Retreats Destination Club will receive a Lifetime Bronze Membership in Club 1. Existing members of the Distinctive Retreats Destination Club will receive a Lifetime Bronze Membership in Club 2. Existing members of the Legendary Retreats Destination Club will receive a Lifetime Platinum Membership in Club 2. All the offered memberships in Ultimate Resort are at no up front cost to the Debtors' Existing Members.

The average target value of homes for Club 1 would be $2,000,000, and the average target value of homes for Club 2 will be $3,500,000. Each of Club 1 and Club 2 will be operated on a 7:1 ratio of equivalent members to club properties.

B. Annual dues will be $9,500 for Bronze Members of Club 1, $14,000 for Bronze Members of Club 2, and $24,500 for Platinum Members of Club 2. Daily usage fees will be $700 for Club 1 and $1,000 for Club 2.

C. Matriculating members with Lifetime Bronze Memberships will have use of their respective Club for a minimum of 14 days per year, with one advanced reservation per year and one advanced holiday reservation every other year. They will be able to reserve an unlimited number of additional days of use, including during holiday weekends, beyond the 14 days, subject to availability and to daily use fees.

D. Matriculating members with Lifetime Platinum Memberships will have use of their respective Club for a minimum of 42 days per year, with four advanced reservations per year, including two advanced holiday reservations or, at their option, may select an alternative lifetime membership plan in Club 2 if they require fewer days or wish to pay lower annual dues. They would be able to reserve an unlimited number of additional days of use, including during holiday weekends, beyond the 42 days, subject to availability and to daily use fees.

E. Matriculating members will be afforded certain upgrade rights and earn "points" redeemable for additional free days or weeks of club usage or to offset other club services.

F. Ultimate Resort will offer each matriculating member the option to purchase the Existing Member's pro rata share of 10% of the common equity of Ultimate Resort on a fully- diluted basis.

At least 400 of the Offerees need to accept the New MembershipContracts with Ultimate Resort for the Sale to be closed, Mr.Daman informs the Court.

Payment to Patriot

In connection with the closing of the Debtors' DIP Financing withAbleco Finance LLC on November 15, 2006, the Debtors paid all ofthe amounts due and owing to The Patriot Group LLC except for$3,500,000. Patriot agreed that the Debtors could delay repayingthe remaining DIP amount in exchange for an $875,000 financingfee. If the Debtors pay the DIP Obligation by November 30, 2006,Patriot agreed that the Debtors would only be obligated to pay a$175,000 financing fee.

In exchange, the Debtors agree to substitute Ultimate Resort forPatriot with all of the protections and security interests thatPatriot currently has, as a DIP lender, with respect to theamount of the Remaining Patriot DIP Obligation that will berepaid from the Deposit. To the extent Ultimate Resort will beentitled to a return to all or a portion of its Deposit under theterms and conditions of the APA, Ultimate Resort would be granteda second priority lien and superpriority administrative expenseclaim for $3,675,000.

At the Closing, the entire amount of the Deposit will be deemedapplied to the final $98,000,000 Purchase Price.

The Debtors ask the Court to exempt the proposed Sale from stampor similar taxes.

The Debtors seek the Court's authority to:

(a) assume and assign certain contracts in connection with the Sale; and

(b) reject certain contracts and leases that would not be assumed and assigned in connection with the Sale.

The Debtors also ask the Court to schedule an initial hearing onNovember 29, 2006, to consider the approval of:

(a) the buyer protections for Ultimate Resort;

(b) the payment of the remaining Patriot DIP Obligation from a portion of the Sale Deposit;

(c) the substitution of Ultimate Resort for Patriot under the Amended Ableco DIP Order; and

(c) the form of notice and other consent documents that Ultimate Resort would provide to the Offerees to give them sufficient information in determining whether to accept New Membership Contracts with Ultimate Resort.

The Debtors further ask the Court to schedule the Sale Hearing onDecember 19, 2006.

Complete Retreats and its debtor-affiliates filed for chapter 11protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245).Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at DechertLLP represent the Debtors in their restructuring efforts. MichaelJ. Reilly, Esq., at Bingham McCutchen LP, in Hartford,Connecticut, serves as counsel to the Official Committee ofUnsecured Creditors. No estimated assets have been listed in theDebtors' schedules, however, the Debtors disclosed $308,000,000 intotal debts.

The Debtors' exclusive period to file a plan expires onFebruary 18, 2007. They have until April 19, 2007, to solicitacceptance to that plan. (Complete Retreats Bankruptcy News,Issue No. 16; Bankruptcy Creditors' Service Inc.,http://bankrupt.com/newsstand/or 215/945-7000).

COMPLETE RETREATS: Non-Gov'tal Units Can File Claims Until Dec. 11------------------------------------------------------------------At the behest of an ad hoc committee of members of CompleteRetreats LLC and its debtor-affiliates, the Honorable Alan H.W.Shiff of the U.S. Bankruptcy Court for the District of Connecticutextended the deadline for all non-governmental parties to fileproofs of claim against the Debtors until Dec. 11, 2006.

The Ad Hoc Committee consists of a group of more than 420 currentand former members of debtor-affiliates Private Retreats LLC andDistinctive Retreats LLC who represent at least $140,000,000 worthof claims in the Debtors' chapter 11 cases.

In its request, the Ad Hoc Committee sought to move the claims bardate for all non-governmental parties to Dec. 29, 2006, fromNov. 27, 2006.

George B. Cauthen, Esq., at Nelson Mullins Riley & ScarboroughL.L.P., in Columbia, South Carolina, informed the Court that asevidenced by the Debtors' claims registers, numerous members havenot yet filed claims in the Debtors' bankruptcy cases for theirrespective destination club.

As of Nov. 15, 2006, the claims registers indicate these number ofclaims filed in the Debtors' cases:

As indicated by the figures in the Debtors' November 15 claimsregisters, hundreds of members of the Debtors' destination clubshave yet to file claims, Mr. Cauthen pointed out. The membersneed additional time to evaluate and file their claims.

Mr. Cauthen argued that the Debtors will not be prejudiced by anextension of the claims deadline for these reasons:

(1) The extension is for a limited period of time and thus, will not unduly delay the administration of the bankruptcy cases;

(2) The Debtors have disputed all member claims;

(3) The Debtors have not yet filed a disclosure statement or Chapter 11 plan; and

(4) The Debtors have been granted an extension of the exclusivity period, among others.

An extension is necessary and equitable in light of thecomplicated nature in which the Debtors organized their affairsand the likelihood that many of the members, most of which areindividuals, have little to no prior experience with bankruptcyissues, Mr. Cauthen said.

Complete Retreats and its debtor-affiliates filed for chapter 11protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245).Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at DechertLLP represent the Debtors in their restructuring efforts. MichaelJ. Reilly, Esq., at Bingham McCutchen LP, in Hartford,Connecticut, serves as counsel to the Official Committee ofUnsecured Creditors. No estimated assets have been listed in theDebtors' schedules, however, the Debtors disclosed $308,000,000 intotal debts.

The Debtors' exclusive period to file a plan expires onFebruary 18, 2007. They have until April 19, 2007, to solicitacceptance to that plan. (Complete Retreats Bankruptcy News,Issue No. 15 and 16; Bankruptcy Creditors' Service Inc.,http://bankrupt.com/newsstand/or 215/945-7000).

COMPLETE RETREATS: Court Reaffirms CIT as Real Estate Advisor-------------------------------------------------------------The U.S. Bankruptcy Court for the District of Connecticutreaffirmed the employment of CIT Capital USA Inc. as CompleteRetreats LLC and its debtor-affiliates' exclusive real estateadvisor and disposition agent, nunc pro tunc to Aug. 18, 2006.

The Court authorized CIT to enter into agreements with local orco-brokers with respect to properties in CIT's Portfolio. CIT,however, will be responsible for co-broker fees or relatedexpenses owed to any local brokers.

In the event there exists a ready, willing, and able buyer forproperty contained in CIT's Portfolio, but the Debtors removethat property from the Portfolio before a sale is consummated,the Court directs the Debtors to pay CIT a Transaction Feeequal to 7% of the gross offered purchase price.

The Court does not permit CIT to provide potential purchasersof the Debtors' Properties with bridge loans.

In addition, the Court does not grant CIT a Termination Fee. TheCourt also does not grant CIT a Transaction Fee with respect to aproperty that is:

-- removed by the Debtors from CIT's Portfolio prior to the presentment of a ready, willing, and able buyer; and

-- retained, prior to the presentment of a ready, willing, and able buyer by CIT, by the Debtors under a plan of reorganization.

The Debtors are directed to pay CIT an Incentive Fee equal to$300,000, which is due and payable only if either Nevis or Abacoproperties are removed by the Debtors from CIT's Portfolio.

As reported in the Troubled Company Reporter on Nov. 7, 2006, theDebtors obtained Court authority, on an interim basis, to employCIT Capital as their exclusive real estate advisor and dispositionagent.

In that interim order, the Court permitted the Debtors to:

-- pay CIT a transaction fee equal to 7% of the gross proceeds of the Sale of any property contained in CIT's Portfolio; and

-- reimburse all reasonable out-of-pocket expenses incurred by CIT in connection with its retention.

Prior to the Court's interim order on the motion, the OfficialCommittee of Unsecured Creditors said it does not object to CITCapital earning a 7% Transaction Fee on traditional sales of realproperty that it assists the Debtors to consummate.

The Committee, however, opposed to the Application to the extentthat the Transaction Fee could be read more broadly to apply toother types of "Transactions," including mergers, strategicpartnership or sale of the Debtors pursuant to a plan ofreorganization.

Moreover, the Committee complained that the contemplated IncentiveFee for CIT is not tied to any performance benchmark and, unlikea typical broker's fee, is not contingent upon any successfulsale of the Debtors' real estate. The Incentive Fee is not a"reasonable term" of employment and compensation under Section328(a) of the Bankruptcy Code, Jonathan B. Alter, Esq., atBingham McCutchen LLP, in Hartford, Connecticut, argued.

The Committee proposed that the Incentive Fee should be:

(a) mutually exclusive with the Transaction Fee. Any Transaction Fee earned should be credited toward any Incentive Fee on a dollar-for-dollar basis;

(b) conditioned on CIT using good faith reasonable commercial efforts to perform the Phase I through III services with respect to the "Sale Properties;" and

(c) reduced because the Debtors have made no showing whether the $750,000 proposed fee is consistent with ordinary market terms for this type of engagement.

Jeffrey K. Daman, Esq., at Dechert LLP, in Hartford, Connecticut,asserted that the fees paid to CIT should not unreasonablyduplicate any similar fees to XRoads Solutions Group, LLC, as theDebtors' financial advisor. The Debtors' estates should not beburdened with duplicative success fees for two financialprofessionals related to the same type of transaction, Mr. Damansaid.

The Termination Fee should not be payable if CIT is terminatedfor cause, Mr. Daman added.

As reported in the Troubled Company Reporter on Sept. 26, 2006,the Debtors told the Court that they are exiting certain of theirproperties. In connection with reorganization efforts, theDebtors hope to sell the Properties in the near future. HollyFelder Etlin, the Debtors' chief restructuring officer, said thatthe Properties are not popular with the Debtors' members and areoften vacant.

Ms. Etlin noted that the Debtors do not have the internalexpertise, infrastructure, or staff necessary to analyze ormarket the Properties competently and cost-effectively.

Members of CIT's Commercial Real Estate group have significantexperience in the disposal of real property assets, Ms. Etlintold the Court. Moreover, CIT has a good reputation, which willlend credibility to the contemplated sale process.

The Debtors will employ CIT pursuant to the terms of a LetterAgreement dated August 18, 2006, between the parties. The CITLetter Agreement is the result of arm's-length negotiationsbetween the Debtors and CIT. Ms. Etlin stated that the Debtorsselected CIT only after considering several other candidates withsimilar expertise.

-- hire local brokers to assist in the sale process and save the Debtors from having to employ brokers under Section 327 of the Bankruptcy Code;

-- meet and negotiate with parties who are interested in acquiring the Properties;

-- negotiate stalking horse sale contracts, as necessary; and

-- identify target buyers for the Properties.

CIT will also establish a "fast-track" disposition for theProperties. Specifically, for certain properties in Nevis,Abaco, the Dominican Republic, and the United States, CIT willcomplete its due diligence, review the Debtors' objectives, andmarket or auction those Properties within 120 days.

Upon the closing of a sale of each of the Properties, the Debtorswill pay CIT a Transaction Fee equal to 7% of the gross proceedsfrom that sale. Any fees for local brokers retained will beincluded in the Transaction Fee.

If the Debtors were to enter into a strategic partnership ormerger that does not include the sale of any Property, CIT willbe entitled to a $75,000 Incentive Fee for advisory servicesperformed.

The Debtors will also reimburse CIT for all its out-of-pocketexpenses, including marketing and travel expenses and reasonableattorneys' fees.

The Debtors asked the Court not to subject the Transaction Fees toany holdbacks and not to require CIT to file and serve detailedtime reports or timesheets since the firm is not seeking anymonthly fees for its services.

Dennis R. Irvin, CIT's executive vice president, assured theCourt that the firm has no connection with, and holds nointerests adverse to, the Debtors, their creditors, or any otherparty-in-interest. Accordingly, CIT is a "disinterested person"as referenced in Section 327(a) of the Bankruptcy Code and asdefined by Sections 101(14) and 1107(b) of the Bankruptcy Code.

Complete Retreats and its debtor-affiliates filed for chapter 11protection on July 23, 2006 (Bankr. D. Conn. Case No. 06-50245).Nicholas H. Mancuso, Esq. and Jeffrey K. Daman, Esq. at DechertLLP represent the Debtors in their restructuring efforts. MichaelJ. Reilly, Esq., at Bingham McCutchen LP, in Hartford,Connecticut, serves as counsel to the Official Committee ofUnsecured Creditors. No estimated assets have been listed in theDebtors' schedules, however, the Debtors disclosed $308,000,000 intotal debts.

The Debtors' exclusive period to file a plan expires onFebruary 18, 2007. They have until April 19, 2007, to solicitacceptance to that plan. (Complete Retreats Bankruptcy News,Issue No. 15; Bankruptcy Creditors' Service Inc.,http://bankrupt.com/newsstand/or 215/945-7000).

As a result of MPSC's action, the average monthly bill of atypical Consumers Energy residential natural gas customer willincrease approximately $2.52 per month.

"The rate increase approved today reflects the rising cost ofnatural gas operations," noted MPSC Chairman J. Peter Lark. "Myfellow Commissioners and I kept increases to a minimum -- significantly below what the utility requested -- in this time ofrising energy costs. In addition, low-income customers willbenefit from the $17 million designated for the Low-Income EnergyEfficiency Fund."

Consumers Energy had, on July 1, 2005, filed an applicationseeking approval from the MPSC to increase its rates for thedistribution of natural gas in the annual amount of $132,400,000.The company also sought partial and immediate rate relief of$75,068,000. The MPSC on May 10 issued an order approving aninterim rate increase of $18.4 million. The total rate increaseapproved since the initial filing of this case comes to$80,804,000.

MPSC's order also gave the Company authority to increase itsnatural gas utility rates for the increase in the cost of naturalgas operations, pensions and retiree health care, and the LowIncome Energy Efficiency Fund.

The MPSC is an agency within the Department of Labor & EconomicGrowth.

Headquartered in Jackson, Michigan, Consumers Energy Company-- http://www.consumersenergy.com/-- a wholly owned subsidiary of CMS Energy Corporation, is a combination of electric and naturalgas utility that serves more than 3.3 million customers inMichigan's Lower Peninsula.

* * *

As reported in the Troubled Company Reporter on July 14, 2006Consumers Energy Co., on July 12, 2006, reached an agreement tosell its 798-megawatt Palisades nuclear plant to Entergy Corp. for$380 million. Fitch says the announcement is not anticipated tohave animmediate effect on Consumers' ratings or Stable Outlook.The Issuer Default Rating of Consumers is 'BB-'.

DELTA AIR: Pilots to Conduct Picket in NY Bankruptcy Court Today----------------------------------------------------------------The pilots of Comair Inc., represented by the Air Line PilotsAssociation International, will conduct informational picketingtoday, from 8:30 a.m. until 9:15 a.m., EST, at the U.S. BankruptcyCourt for the Southern District of New York, One Bowling Green(and Broadway), Alexander Hamilton Custom House, in New York.Comair operates under the "Delta Connection" livery and is awholly owned subsidiary of Delta Air Lines Inc.

The pilots are picketing to demonstrate their frustration withmanagement's efforts to sidestep the negotiating process by filingan 1113(c) motion with the bankruptcy court. If approved, thismotion could repudiate and breach the pilots' labor contract andallow Comair management to unilaterally impose terms ofemployment.

In 2005, the Comair pilots agreed to concessions to help theirairline better manage its finances. Later that year, Comair andparent company Delta filed for Chapter 11 bankruptcy. In morerecent contract talks, Comair management has taken an unreasonableposition concerning the level of additional concessions the pilotsmust provide. The pilots want Comair to demonstrate that theconcessions sought are necessary for the company's recovery, andnot simply a means of applying pressure to other Delta Connectionpilot groups to lower their compensation and work rules.

In contrast, the pilots have been flexible, submitting numerousproposals that offer substantial contract relief. Finally, theComair pilots would like something in exchange for this sacrifice,such as job security and wage snap- back provisions in lateryears, especially since the airline has already returned toprofitability. Unfortunately, Comair management appears to preferto litigate in bankruptcy court rather than seriously negotiatewith its pilots.

Founded in 1931, ALPA is a pilot union, representing more than60,000 pilots at 39 airlines in the United States and Canada.Visit the ALPA website at http://www.alpa.org/

Headquartered in Atlanta, Georgia, Delta Air Lines (Other OTC:DALRQ) -- http://www.delta.com/-- is the world's second-largest airline in terms of passengers carried and the leading U.S.carrier across the Atlantic, offering daily flights to 502destinations in 88 countries on Delta, Song, Delta Shuttle, theDelta Connection carriers and its worldwide partners.

Each Class F Depositary Share is equal to one tenth of a share ofDevelopers Diversified's 8.60% Class F Cumulative RedeemablePreferred Stock. This dividend covers the period beginning onSept. 15, 2006 and ending on Dec. 14, 2006. The declaredPreferred Class F Dividend is payable Dec. 15, 2006 toshareholders of record at the close of business on Dec. 1, 2006.

Each Class G Depositary Share is equal to one tenth of a share ofDevelopers Diversified's 8.00% Class G Cumulative RedeemablePreferred Stock. This dividend covers the period beginning onSept. 15, 2006 and ending on Dec. 14, 2006. The declaredPreferred Class G Dividend is payable Dec. 15, 2006 toshareholders of record at the close of business on Dec. 1, 2006.

In addition, also declared its fourth quarter 2006 common sharedividend of $0.59 per share, which is payable Jan. 8, 2007 toshareholders of record at the close of business on Dec. 22, 2006.

About Developers Diversified

Based in Beachwood, Ohio, Developers Diversified RealtyCorporation -- http://www.ddr.com/-- currently owns and manages over 500 retail operating and development properties in 44 states,plus Puerto Rico and Brazil, totaling 118 million square feet.The Company is a self-administered and self-managed real estateinvestment trust operating as a fully integrated real estatecompany which acquires, develops and leases shopping centers.

DORAL FINANCIAL: Posts $50.9MM Net Loss for Second Quarter 2006---------------------------------------------------------------In its Form 10-Q filed with the U.S. Securities and ExchangeCommission, Doral Financial Corporation reported financial resultsfor the first quarter ended March 31, 2006, and second quarterended June 30, 2006.

For the first quarter, Doral Financial reported a net income of$17.1 million, compared to a net income of $39.2 million for thesame period in 2005. The company also reported a net loss of$50.9 million for the second quarter ended June 30, 2006, comparedto a net loss of $22.8 million for the comparable period of 2005.

For the first six months of 2006, Doral Financial incurred a netloss of $33.8 million, compared to net income of $16.4 million forthe same period of 2005.

Filing Concerns

"With the filing of our results for the first half of the year, wehave completed another difficult chapter as we move forward in oureffort to transform Doral's business and operations into a highermargin financial services enterprise," stated Glen Wakeman, ChiefExecutive Officer. "Since the beginning of this past summer,Doral has installed a new senior management team, recruitingexperienced executives with both the skills set and values tobuild competitive advantages for Doral in the marketplace,including capitalizing on the potential of the Doral brand inPuerto Rico.

Senior Notes Refinancing

In moving forward, Doral is also addressing substantialchallenges. Among the key challenges are the refinancing of theCompany's $625 million floating rate senior notes that mature inJuly 2007, the restructuring of the balance sheet to enhancefuture earnings and the resolution of remaining restatementrelated issues. The Board and new senior management team arecommitted to resolving these challenges in a manner that servesthe long-term interests of Doral and all its stakeholders.

With respect to its $625 million floating rate senior notes thatmature in July 2007, Doral will require outside financing or othersources of capital to refinance this indebtedness at maturity.Accordingly, Doral is in the process of selecting a financialadvisor to assist the Company in reviewing a number of possiblealternatives to refinance this indebtedness and in examiningalternatives to restructure its balance sheet in order to enhancefuture earnings," stated Mr. Wakeman.

Filing Delay

Although with the filing of its results for the first half of theyear Doral has become current in its SEC regulatory filings, theCompany does not expect, because of the delay in filing its priorSEC reports, that it will be able to file its quarterly report onForm 10-Q for the third quarter of 2006 by its due date.

"The transformation of Doral is going to be done prudently andwill take time. Central to this long-term effort is to capitalizeon and expand the Doral brand in Puerto Rico and, whereappropriate, in other Hispanic market segments in the U.S. It isour goal to offer a diverse higher margin product portfolio,improved customer technologies and outstanding customer service,all within an environment that is focused on tight cost control,enhanced productivity and strong corporate values. Our portfoliowill include, among its products and services, a full suite ofmortgage products to allow Doral to remain a leading mortgageoriginator in Puerto Rico," said Mr. Wakeman.

Overview of Financial Condition and Results of Operations

Doral Financial's consolidated financial statements for the firstsix months of 2006 reflect the difficult business environment andchallenges faced by the Company. Doral Financial's results ofoperations for the first six months of 2006 were principallyimpacted by:

(1) reduced net interest income due principally to the interest rate environment and the repricing and maturity mismatch in the Company's assets and liabilities;

(2) a net loss on mortgage loan sales and fees due to market value adjustments on the Company's held for sale portfolio, losses related to the restructuring of mortgage loan transfers to local financial institutions and lower margins on sales of mortgage loans;

(3) increased expenses associated with the Company's restatement and reengineering initiative; and

(4) a change in tax position from a tax expense for the first six months of 2005 to a tax benefit for the first six months of 2006.

Key Components of Financial Performance

(1) Interest Income

Net interest income for the six months ended June 30, 2006 was$114.1 million, compared to $151.4 million for the same period in2005, a decrease of 24.7%. The decrease in net interest incomeresulted from a decrease in net interest margin from 1.74% in thefirst half of 2005 to 1.46% for the first half of 2006, coupledwith a decrease in average interest-earning assets from $17.5billion for the first half of 2005 to $15.7 billion for the firsthalf of 2006, principally due to a decrease in investment andmortgage-backed securities and in money market investments.

The reduction in net interest margin resulted from the flatteningof the yield curve, as on average, the Company's interest bearingliabilities, principally wholesale funding and loans payable, re-priced at higher frequency and rates than the Company's interest-earning assets. The decrease in the Company's interest margin hasbeen particularly significant with respect to its portfolio ofinvestment securities.

Assuming a funding cost equal to the weighted-average cost of theCompany's repurchase agreements, the average interest rate spreadon the Company's portfolio of investment securities wasapproximately 0.41% for the six months ended June 30, 2006,compared to 1.36% for the Company's interest earning assets takenas a whole.

The impact of the flattening yield curve on the Company's netinterest margin is magnified by the current mismatch in theduration of the Company's assets and liabilities. The Company'sinterest-earning assets include a large portfolio of fixed-ratelong-term investments securities and mortgage loans that weregenerally financed with short-term or callable liabilities. Thismismatch exposes the Company to significant interest rate risk ina rising rate environment because, as these short-term or callableliabilities re-price at higher market rates, the Company'sinterest rate margin is further compressed. The Company's interestrate risk exposure is further complicated by the negativeconvexity inherent in the Company's portfolio of fixed ratemortgage-backed securities and mortgage loans. The combination ofthis negative convexity and the current composition of theCompany's liabilities exposes the Company to margin compressionrisks even during certain declining interest rate environments.

(2) Loan and Lease Losses

The provision for loan and lease losses for the first six monthsof 2006 was $11.0 million, compared to $7.7 million for thecomparable 2005 period. The increase in the provision for loanand lease losses primarily reflects an increase in the allowancefor the Company's construction loan portfolio, as well as anincrease in the delinquency trends of the Company's overall loansportfolio.

(3) Non-Interest Income and Loss

Non-interest loss for the first six months of 2006 was $31.2million, compared to non-interest income of $461,000 for the sameperiod in 2005. The non-interest loss was primarily due to a netloss on mortgage loan sale and fees of $41.5 million, compared toa gain of $23.3 million for the corresponding 2005 period. Thisloss was principally due to the Company reassessment of itsmortgage loans held for sale portfolio in light of the morestringent requirements of the U.S. secondary mortgage market,which has become its principal outlet for non-conforming loans asa result of reduced demand for this product from Puerto Ricofinancial institutions, and also to losses on sales of mortgageloans driven by the Company's decision to restructure previousmortgage loan transfers to local financial institutions.

During the first quarter of 2006, management transferred $876.2million from its mortgage loans held for sale portfolio to itsloan receivable portfolio, which resulted in a market valueadjustment of $12.3 million that was taken as a charge againstearnings during the first quarter of 2006. During the secondquarter of 2006, the Company recognized an aggregate net loss ofapproximately $8.2 million as a result of the restructuring ofcertain prior mortgage loan transfers.

In addition, the Company made downward market value adjustments of$5 million in the first quarter and $17.5 million in the secondquarter to reflect the impact of rising interest rates on theCompany's mortgage loans held for sale portfolio, as well asmarket terms for secondary sales in the U.S. market. During 2006,the Company has also experienced lower margins on sales ofmortgage loans as the Company sold its non-conforming loanproduction in the U.S. market at a lower gain.

The Company also incurred a net loss on securities held fortrading, including gains and losses on the fair value of IOs, of$17.5 million for the first six months of 2006, compared to a netloss of $36.4 million for the comparable 2005 period. Thepositive variance in trading activities during the first half of2006, compared to the first half of 2005, was principally due tonet gains on the Company's derivative instruments of $25.4 millionfor the first six months of 2006, as compared to net losses of$57.5 million during the first half of 2005. Offsetting the gainson derivative instruments were net unrealized losses of $42.9million on the value of the Company's IOs for the first six monthsof 2006, compared to net unrealized gains of $15.6 million for thecomparable 2005 period. Losses on the value of the Company's IOsduring the first half of 2006 were primarily related to floatingrate IOs that did not have caps on the pass-through interest ratepayable to investors.

During the second quarter of 2006, Doral Financial was able torestructure its prior mortgage loan transfers giving rise tofloating rate IOs and all of its remaining portfolios of floatingrate IOs have caps on the pass-through interest rate payable toinvestors.

These net losses were partially offset by higher servicing incomerelated with an increase in the Company's MSRs valuation due to adecrease in anticipated mortgage prepayment rates and highercommissions, fees and other income.

(4) Non-Interest Expenses

Non-interest expenses for the first half of 2006 were $134.6million, compared to $122.0 million for the same period in 2005.Non-interest expenses for the period continue to reflectsignificant expenses for professional services associated with therestatement of the Company's prior period financial statements andrelated legal and accounting matters. Non-interest expenses forthe first half of 2006 also reflect significant expensesassociated with advisory services relating to the reengineering ofthe Company's business and operating practices, as well as $7.4million in severance payments in connection with the relatedheadcount reduction.

(5) Income Tax

For the first half of 2006, Doral Financial recognized an incometax benefit of $28.9 million, compared to an income tax expense of$5.7 million for the corresponding period in 2005. The decrease inthe tax provision for 2006 was principally due to an increase inthe Company's net deferred tax asset combined with a decrease inpre-tax income, offset in part by higher net operating losses incertain subsidiaries that under the Puerto Rico Internal RevenueCode of 1994 could not be used to offset gains in othersubsidiaries.

(6) Other Losses

During the first half of 2006, the Company had other comprehensiveloss of approximately $125.2 million related principally to theadverse impact of the increase in interest rates on the value ofthe Company's portfolio of available for sale securities. As ofJune 30, 2006, the Company's accumulated other comprehensive lossreached $250.6 million.

(7) Loan Production

Doral Financial's loan production for the first six months of 2006was $1.4 billion, compared to $2.8 billion for the comparableperiod in 2006, a decrease of approximately 50%. The decrease inDoral Financial's loan production is due to a number of factorsincluding changes in the underwriting processes, economicconditions in Puerto Rico, and competition from other financialinstitutions.

Doral Financial is in the process of implementing new underwritingprocedures. The implementation of these procedures has causeddisruption in the Company's loan originations. The Companybelieves that these underwriting standards will allow it to moreefficiently underwrite assets with better credit quality and riskprice its loan products in the future. The Company anticipatesthat, for the foreseeable future, loan production volume willcontinue to be below historical levels as these new underwritingprocedures are implemented and new product offerings aredeveloped. For example, loan production for the third quarter of2006 was approximately $329.8 million. However, the Company isstarting to see improving trends in its loan production during thefourth quarter of 2006.

Doral Financial and its banking subsidiaries remain "wellcapitalized" for bank regulatory purposes as of June 30, 2006.

About Doral Financial

Based in New York City, Doral Financial Corp. (NYSE: DRL) -- http://www.doralfinancial.com/-- a financial holding company, is a residential mortgage lender in Puerto Rico, and the parentcompany of Doral Bank, a Puerto Rico based commercial bank, DoralSecurities, a Puerto Rico based investment banking andinstitutional brokerage firm, Doral Insurance Agency, Inc. andDoral Bank FSB, a federal savings bank based in New York City.

* * *

As reported in the Troubled Company Reporter on Oct. 31, 2006,Standard & Poor's Ratings Services removed from CreditWatch andaffirmed its ratings on Doral Financial Corp., including its 'B+'counterparty rating. The ratings were placed on CreditWatch withnegative implications on April 19, 2005. The outlook is negative.

DURA AUTOMOTIVE: Judge Carey Approves Equity Trading Procedures---------------------------------------------------------------The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for theDistrict of Delaware granted, on a final basis, DURA AutomotiveSystems Inc. and its debtor-affiliates' request for theinstitution of procedures for the trading of their equitysecurities to which parties must adhere as a precondition of theeffectiveness of the trades.

The Company says that the procedures for the trading of its equitysecurities, is meant to protect and preserve the federal netoperating losses.

Over the past several years, through Sept. 30, 2006, the Debtorshave incurred consolidated federal NOLs of approximately$437,000,000, Mark D. Collins, Esq., at Richards, Layton & Finger,P.A., in Wilmington, Delaware, relates.

Mr. Collins explains that the NOLs are valuable to the Debtors andtheir estates because the Debtors can carry forward NOLs to setoff future taxable income for up to 20 taxable years, thusreducing future tax obligations and freeing up funds to meetworking capital requirements and service debt. The Debtors mayalso utilize the NOLs to set off any taxable income generated bytransactions completed during their stay in Chapter 11.

According to Mr. Collins, unrestricted trading of Dura equitysecurities could adversely affect the Debtors' NOLs if:

(a) too many 5% or greater blocks of equity securities are created; or

(b) too many shares are added to or sold from the blocks such that, together with previous trading by 5% shareholders during the preceding three-year period, an ownership change within the meaning of Section 382 of the Internal Revenue Code, as amended, is triggered prior to emergence and outside the context of a confirmed Chapter 11 plan of reorganization.

Without the restrictions on trading, the Debtors' ability to usetheir NOLs could be severely limited or even eliminated, and couldlead to negative consequences for the Debtors, their estates andthe overall reorganization process, Mr. Collins asserted.

Under Section 382, change of ownership occurs when the percentageof a company's equity held by one or more 5% shareholdersincreases by more than 50 percentage points over the lowestpercentage of stock owned by the shareholders at any time during athree-year rolling testing period.

In addition, Section 382 limits the amount of taxable income thatcan be set off by a pre-change-of-ownership loss to the long-termtax-exempt bond rate, as of the ownership change date, multipliedby the value of the stock of the loss corporation immediatelybefore the ownership change. Under certain circumstances, built-in losses recognized during the five-year period after the changedate are subject to similar annual limitations.

NOL Procedures

By establishing procedures for continuously monitoring the tradingof equity securities, the Debtors can preserve their ability toseek substantive relief at the appropriate time, particularly ifit appears that additional trading may jeopardize the use of theDebtors' NOLs, Mr. Collins tells the Court.

Judge Carey authorized the Debtors to establish these proceduresfor trading of equity securities:

(i) Any person or entity who is currently a substantial shareholder must file with the Court, and serve upon the Debtors and counsel to the Debtors, a Notice of Status as a substantial shareholder, on or before 40 days after the effective date of the notice of entry of an interim order approving the NOL Procedures.

(ii) Before effectuating any transfer of equity securities that would result in an increase in the amount of common stock of Dura beneficially owned by a substantial shareholder or would result in a person or entity becoming a substantial shareholder, the substantial shareholder or person or entity must file with the Court, and serve on the Debtors and attorneys for the Debtors, an advance written notice of the intended transfer of equity securities.

(iii) Before effectuating any transfer of equity securities that would result in a decrease in the amount of common stock of Dura beneficially owned by a substantial shareholder or would result in a person or entity's ceasing to be a substantial shareholder, the substantial shareholder must file with the Court, and serve on the Debtors and attorneys for the Debtors, an advance written notice of the intended transfer of equity securities.

(iv) The Debtors would have 15 calendar days after, receipt of a notice of proposed transfer to file with the Court and serve on the substantial shareholder an objection to any proposed transfer of equity securities described in the notice of proposed transfer on the grounds that the transfer might adversely affect the Debtors' ability to utilize their NOLs. If the Debtors file an objection, the transaction would not be effective unless approved by a final and non-appealable order of the Court. If the Debtors do not object within the 15-day period, the transaction could proceed solely as set forth in the notice of proposed transfer. Further transaction must be the subject of additional notices, with an additional 15-day waiting period.

The Debtors define a "substantial shareholder" as any person orentity that beneficially owns at least 850,000 shares -- representing approximately 4.5% of all issued and outstandingshares -- of the common stock of Dura.

"Beneficial ownership" of equity securities includes direct andindirect ownership, ownership by the holder's family members andpersons acting in concert with the holder to make a coordinatedacquisition of stock.

Mr. Collins tells the Court that the NOL Procedures will allow theDebtors to monitor certain transfers of Dura equity securities sothey can act expeditiously to prevent the transfers, if necessary,and preserve the NOLs.

Rochester Hills, Mich.-based DURA Automotive Systems, Inc.(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seatingcontrol systems, glass systems, engineered assemblies, structuraldoor modules and exterior trim systems for the global automotiveindustry. The company is also a supplier of similar products tothe recreation vehicle and specialty vehicle industries. DURAsells its automotive products to North American, Japanese andEuropean original equipment manufacturers and other automotivesuppliers.

The Debtors also obtained the Court's authority to direct banksand other financial institutions to receive, process, honor, andpay all checks presented for payment and electronic paymentrequests relating to the employee obligations.

The Debtors also intended to satisfy their obligations to paypostpetition wages and certain benefits of their employees in theordinary course, as they become due.

The Debtors employ 6,440 employees in the United States, of whomapproximately 4,950 are hourly employees and 1,490 are salariedemployees. Additionally, the Debtors employ 690 employees inCanada, of whom approximately 140 are full-time salaried employeesand approximately 550 are hourly employees.

Mr. Collins averred that nonpayment of employee compensation andbenefits could severely undermine morale and impose real hardshipon the employees, generate doubts about the stability of theDebtors and their prospects for reorganization, and create asignificant risk of attrition.

Employee Obligations

A. Unpaid Compensation

The Debtors' average aggregate monthly gross compensation foremployees, including wages, salaries, and bonuses, is $19,440,000for the U.S. employees and $2,640,000 for the Canadian employees.

Approximately 90% of payroll is made by direct deposit throughelectronic transfer of funds directly to employees' accounts, andthe remaining 10% of employees is paid via checks.

As of Oct. 30, 2006, the Debtors have not paid their employees allprepetition wages held in arrears. Additionally, compensation maybe due and owing as of their bankruptcy filing because:

(a) some discrepancies may exist between the amounts paid and amounts employees or others believe should have been paid, which, upon resolution, may reveal that additional amounts are owed to the employees;

(b) some payroll checks issued prepetition to employees may not have been presented for payment or cleared the banking system and, accordingly, have not been honored and paid as of Oct. 30, 2006; or

(c) variations in the Debtors' various payroll schedules.

The Debtors have funded their payroll for both hourly and salariedemployees that would normally be due.

The Debtors estimate that as of their bankruptcy filing, onehourly pay period is outstanding and as much as one salary payperiod may still be outstanding, consisting of $6,480,000 inaccrued wages, salaries, overtime pay, commissions, and othercompensation earned, prior to the filing for chapter 11protection, by non-union U.S. Employees.

The Debtors also estimate that roughly one hourly pay period andone salary pay period is outstanding to the non-union Canadianemployees, consisting of a further CDN$485,000 of unpaidcompensation due and owing.

The Debtors said it will not pay any employee more than $10,000for the unpaid compensation.

Additionally, the Debtors have certain employees whose employmentis governed by collective bargaining agreements. As of Oct. 30,2006, the outstanding unpaid compensation owed to unionemployees also consists of approximately one hourly pay period andone salary pay period, or approximately $805,000 for U.S.employees and approximately CDN$405,000 for union employees inCanada.

The Debtors have also entered into various employment agreementswith several of their executives and certain of their otheremployees. The Debtors are not currently seeking to assume orreject these employment agreements at this time, but are seekingauthority and discretion to continue honoring those employmentagreements in accordance with their terms.

B. Deductions and Withholdings

During each applicable pay period, the Debtors routinely deductcertain amounts from paychecks, including, without limitation:

(a) union dues;

(b) credit union deposits and payments;

(c) garnishments, child support, and similar deductions; and

(d) other pre-tax and after-tax deductions payable pursuant to certain of the employee benefit plans, as well as deductions for individual insurance programs selected by the employees.

The Debtors forward the deducted amounts to various third partyrecipients.

Further, the Debtors are required by law to withhold:

-- from their U.S. Employees' wages amounts related to federal, state and local income taxes, social security and Medicare taxes for remittance to the appropriate federal, state or local taxing authority.

-- from their Canadian Employees' wages amounts related to federal and provincial income taxes, the Quebec/Canada Pension Plan, unemployment taxes and provincial health insurance taxes.

The withheld amounts and deductions typically total $3,750,000from the U.S. employees' paychecks and CDN$325,000 from theCanadian employees' paychecks each Pay Period.

The deductions are $2,160,000 from the U.S. employees' paychecksand CDN$50,000 from the Canadian employees' paychecks. However,due to the Debtors' bankruptcy filing, some of the funds werededucted from employees' earnings, but may not have been forwardedto the appropriate third party recipients before their bankruptcyfiling.

The Debtors' payroll taxes, including the employee and employerportion, typically total $2,400,000 each combined hourly andsalary pay period. in each combined hourly and salary pay period,the Debtors typically withhold $1,600,000 in the aggregate fromthe U.S. employees' paychecks and CDN$275,000 from the Canadianemployees' paychecks.

Before their bankruptcy filing, the Debtors withheld theappropriate amounts from employees' earnings for the payrolltaxes, but the funds may not have been forwarded to theappropriate taxing authorities prior to Oct. 30, 2006.

C. Reimbursable Expenses

The Debtors routinely reimbursed employees for certain expensesincurred on the Debtors' behalf.

With respect to plant locations that have not transitioned to theDebtors' centralized shared services initiative, reimbursableexpenses total approximately $220,000 per month. The Debtors'Canadian plants typically incur CDN$83,000 in reimbursableexpenses each month.

As of Oct. 30, 2006, less than $255,000 in reimbursableexpenses remained unpaid to employees whose expenses are notgoverned by the Debtors' centralized shared services program.

In addition, to streamline the process of paying expenses incurredby employees on the Debtors' behalf, the Debtors have implementeda program through which certain banks, including Bank of America,N.A., issued company credit cards to approximately 950 employeesfor business use. Amounts charged to these company credit cardsare billed directly to the Debtors and historically averaged$1,100,000 per month. The Debtors believe that this full monthlyamount may be outstanding as of Oct. 30, 2006.

D. Atwood Gainsharing Plan

Approximately 2,600 employees in certain of the Atwood MobileProducts' plants are eligible to participate in an annualincentive plan, which provides employees with cash incentives ifcertain production performance goals are met.

The Debtors have distributed approximately $560,000 in cashincentives for achieved performance goals in the first twoquarters of 2006.

E. Dura Automotive Systems Inc. Annual Bonus Plan

Approximately 150 Employees participate in the Dura AutomotiveSystems Inc. Annual Bonus Plan, which is open to employees holdingcertain management positions ranging from technology and qualitymangers to plant managers.

The Debtors did not make any bonus payments under the ABP in 2006based on the Company's 2005 performance, and do not intend to makeany payments in 2007 based on the Company's 2006 performance.Indeed, the Debtors do not expect to make bonus payments pursuantto the ABP until February 2008.

F. Enterprise Resource Planning

Approximately 25 employees have agreed to participate in theDebtors' Enterprise Resource Planning and QAD ImplementationInitiative -- a software program designed to centralize andstreamline the Debtors' administrative functions and to unify theDebtors' time-worked tracking and attendance system and theDebtors' manufacturing tracking system.

Each of the 25 employees has entered into an employment agreementwith the Debtors, which outlines, among other terms, the basesalary and incentive payments for completion of the initiative.The Debtors estimate that the total payout for incentive bonuspayments earned will be $205,000.

G. Severance Payments and Obligations

The Debtors are party to a number of severance agreements withcurrent and former employees that provide for varied, yetprescribed, amounts of severance payments in consideration forservices provided and to allow the Debtors' planned operationalrestructuring initiatives to take place through reductions in thelabor force.

In this connection, the Debtors have, as of Oct. 30, 2006,terminated 275 employees and transferred another 30 employees toalternate positions within the Debtors' operations.

About 125 terminated employees have severance agreements thatprovide for severance payments totaling approximately $1,950,000in the aggregate, of which $800,000 has already been paid and$1,150,000 is budgeted to be paid over the coming weeks. Duringthe next 30 days after their bankruptcy filing, the Debtors expectto pay less than $675,000 in prepetition severance payments andobligations.

In some cases, provisions in applicable CBAs or employmentagreements provide for a greater measure of severance benefits toterminated employees. Of these terminated U.S. employees, theDebtors estimate that only eight have claims exceeding the $10,000priority limit contained in Section 507(a) of the Bankruptcy Codefor unpaid severance obligations. Unpaid severance obligationsfor seven of these eight former employees range from approximately$10,400 to approximately $13,700.

The Debtors are concerned that their failure to honor theseverance agreements in the midst of an operational restructuringwill cause employees who may be terminated in the future as theoperational restructuring continues, to place little faith inoffers of severance pay that may be made down the line. Hence,the Debtors seek authority to continue to honor and enter intoagreements to provide the severance payments and obligations intheir sole discretion, in the ordinary course of their businesses,pursuant to CBA provisions, where applicable, and to pay anyprepetition amounts owed in connection therewith.

H. Other Employee Compensation Programs

On Aug. 21, 2006, the Debtors implemented a key managementincentive program, which offers 55 key employees the opportunityto participate in a discretionary bonus plan program. The KeyManagement Incentive Program, which runs through Dec. 31, 2007, isdesigned to provide incentives in the form of periodic cash bonusawards to motivate the key employees to attain specificperformance goals articulated under the plan.

On Sept. 29, 2006, the Debtors made their first payment toparticipants, in the aggregate amount of $952,480. The Debtorswill separately seek Court authority before making any payoutunder the Key Management Incentive Plan.

As of Oct. 30, 2006, at least one former U.S. non-union employeeis owed significantly more than $10,000 in unpaid severancepayments. His unpaid severance payments total approximately$180,000 and consist of a severance payment period of 12 months.The Debtors intend to seek Court authority to continue thesepayments via a separate pleading to be filed with the Court.

Employee Benefits

The Debtors provide employees, in the ordinary course of business,with a number of employee benefits, including, but not limited to:

The Debtors offer these benefits plans and insurance policies totheir U.S. Employees for medical, dental, and vision coverage:

(a) The Dura Choice Plan -- Approximately 5,500 employees participate in the Dura Choice Plan, the Debtors' primary self-insured medical and prescription drug plan. The Debtors paid approximately $39,000,000 in 2005 under the self-insured plan, including approximately $1,300,000 in administrative fees paid to third party administrators, NGS American and MedCo Health Solutions, Inc.

(b) The HMOs -- The Debtors also offer four fully insured medical plans to certain of their Employees:

(i) the Priority Health of Northern Michigan Medical Plan,

(ii) the Priority Health of Western Michigan Medical Plan,

(iii) the Health Alliance Plan for the Metro-Detroit Region, and

(iv) the Health Spring Medical Plan for Tennessee.

Each of these HMOs is fully insured with the respective insurer and together provide coverage to approximately 380 of the Debtors' employees. In 2005, the Debtors paid about $2,700,000 in premiums to maintain this coverage, which represents approximately 85% of the cost of total coverage. The participating Employees contribute the remainder of the cost.

(c) Dura Choice Dental Plan -- NGS American administers the Debtors' self-insured dental plan on behalf of 5,900 participating employees. In 2005, the Debtors paid $2,250,000 to maintain this plan, which amount is included in the approximate cost of the Dura Choice Plan.

(d) Employee-Paid Vision Plan -- The Debtors provide the Employees with the option to participate in a vision plan, which is fully insured through Vision Service Plan. The 3,800 participating Employees contribute 100% of the premiums in exchange for the coverage.

The Debtors offer these medical and dental programs to theirCanadian Employees:

(i) Supplementary Health Plan -- The Supplementary Health Plan is the Debtors' Canadian medical and prescription drug plan. The plan is insured through Manulife Financial and the Debtors paid a CN$1,840,000 in annual premiums in 2005 to maintain the plan. The Debtors expect to pay approximately CN$1,850,000 in premiums for 2006.

(ii) Dental Plan -- All Canadian Employees participate in the Dental Plan, which is also insured through Manulife Financial. The Debtors paid approximately CN$750,000 in premiums in 2005 to maintain this plan. The Debtors expect to pay approximately CN$850,000 in premiums in 2006.

B. Workers' Compensation

Pursuant to state laws, the Debtors must maintain workers'compensation liability coverage in the ordinary course ofbusiness. Generally, the Debtors self-insure their workers'compensation liabilities up to $500,000 per claim and useThe St. Paul Travelers Companies as their third-partyadministrators and insurer. The Debtors also maintain workers'compensation insurance coverage for certain liabilities pertainingto Employees of certain Atwood Mobile Products' plant locationswith Raffles Insurance Ltd., for which Zurich Services Corporationacts as the Debtors' third party administrator.

In connection with the Workers' Compensation Programs, theDebtors have provided these letters of credit as collateral:

(i) a letter of credit for $17,829,000 to Travelers Indemnity Company;

(ii) a letter of credit for $1,120,597 to the Royal Bank of Canada; and

(iii) a letter of credit for $100,000 to the state of Michigan.

Certain benefits under the Workers' Compensation Programs havebeen awarded prepetition, but have yet to be fully paid. Certainother claims were filed prepetition, but have yet to be resolved.For the claims administration process to operate in an efficientmanner and to ensure that they comply with their state lawrequirements, the Debtors propose to continue their claimassessment, determination and adjudication process to payprepetition workers' compensation claims.

The costs associated with the Workers' Compensation Programsfluctuate according to the various claims submitted, however, theDebtors' overall claims costs associated with their Workers'Compensation Programs were $2,877,079 during the period fromJan. 1, 2006, through July 31, 2006.

In Canada, the payment of workers' compensation benefits isinsured and administered through the federal and provincialgovernments. The Debtors are required by law to pay monthlypremiums to the Workers' Compensation Board to maintain thesebenefits. The monthly premiums vary depending upon each coveredEmployee's earned wages; however, the Debtors' September 2006premiums for their Canadian facilities and Employees totaledapproximately CDN$88,500.

C. Vacation and Sick Pay

The Debtors provide vacation time to their employees as a paidtime-off benefit. The Debtors generally pay employees for anyearned, but unused, vacation time upon termination.

In addition, certain Salaried U.S. employees are eligible forsalary continuation for absences due to illness or injury for upto 26 weeks. Other salaried U.S. employees are eligible forsalary continuation equal to 75% of their pay for up to 26 weeks,and hourly U.S. employees are eligible to receive a prescribedweekly amount of up to $200 for a maximum of 26 weeks. After 26weeks, the Debtors' long-term disability benefits manages salariedU.S. employees' claims if the salaried U.S. smployee's applicationto Unum Provident, the Debtors' long-term disability insurancecarrier, is approved.

Certain salaried canadian employees are also eligible for salarycontinuation for absences due to illness or injury for up to 52weeks pursuant to the Debtors' policy, as are Hourly Canadianemployees. After 52 weeks, the Debtors' long-term disabilitybenefits manages Canadian employees' claims if the CanadianEmployee's application to Manulife Financial is approved.

D. Employee Pension, Savings, and Retiree Medical Plans

The Debtors maintain several pension, savings and retiree medicalplans for the benefit of their employees, including, but notlimited to, the 401 (k) Plans, the Non-Qualified 401(k) Look-a-Like Plan, the Canadian Defined Contribution Plan for SalariedEmployees, the Pension Plans, and the Retiree Medical Plans:

(i) 401(k) Plans

The Debtors maintain three 401(k) savings plans for the benefit of their Employees. Each 401(k) Plan provides for automatic pre-tax salary deductions of eligible compensation up to the limits set by the Internal Revenue Code. Approximately 61% of the U.S. employees participate in the 401(k) Plans, and the aggregate monthly amount withheld from employees' paychecks is $840,000.

The Debtors also pay matching contributions depending on Employee classification, collective bargaining provisions and plan participation. The Debtors' monthly matching contributions with respect to the 401(k) Plans are approximately $470,000.

(ii) The Non-Qualified 401(k) Look-a-Like Plan

The Debtors also maintain a rabbi trust with T. Rowe Price to hold funds attributable to a non-qualified deferred compensation plan that is fully funded by the participants and not by the Debtors.

The Debtors pay T. Rowe Price $1,000 per year to administer the Non-Qualified 401(k) Look-a-Like Plan. Currently, the Non-Qualified 401(k) Look-a-Like Plan has five participants: four active Employees and one retired Employee who has elected to receive installment payments over three years' time. No employee currently contributes to the Non-Qualified 401(k) Look-a-Like Plan.

(iii) Canadian Defined Contribution Plan for Salaried Employees

The Debtors maintain one defined contribution plan on behalf of their Canadian employees. The Canadian Defined Contribution Plan for salaried employees provides for automatic pre-tax salary deductions of eligible compensation up to a limit of 18% of earned income per Employee or CDN$19,000.

The Canadian Defined Contribution Plan for salaried employees has approximately 180 participants, and the approximate aggregate monthly amount withheld from employees' paychecks is CDN$31,000.

The Debtors also pay matching contributions of 100% on the first 3% of contributions and 50% on the next 2% of contributions. Employees are also offered the opportunity to contribute an additional 6% of earnings, which are not matched by the Debtors.

During the first nine months of 2006, the Debtors paid CDN$40,000 to maintain the Canadian Defined Contribution Plan.

(iv) U.S. Pension Plans

The Debtors maintain four pension plans on behalf of certain of their U.S. employees. The Dura Master Pension Plan is a consolidation of six pension plans that have been "frozen" -- its participants are accruing vesting rights but not benefits under the plan. The Debtors maintain two plans for union employees under which benefits continue to accrue -- the Mancelona Pension Plan and the LaGrange Pension Plan -- while benefits under the Atwood Supplementary Pay Plan no longer accrue. The Debtors fund these U.S. Pension Plans on behalf of 4,943 Employees.

(v) Canadian Pension Plans

The Debtors maintain six pension plans on behalf of certain of their Canadian employees, three of which are maintained on behalf of hourly, unionized Canadian employees and three of which are maintained on behalf of certain salaried Canadian employees. As of Dec. 31, 2005, the Canadian Pension Plans contained approximately 900 participants and cost the Debtors approximately CDN$2,750,000 annually to fund.

(vi) Retiree Medical Programs

Certain union employees will be entitled to receive retiree medical and prescription drug benefits upon their retirement from the Company, and certain former union and non-union employees are receiving retiree medical and prescription drug benefits under a number of retiree medical plans. As of the Oct. 30, 2006, 229 currently retired union and non-union employees were receiving retiree benefits pursuant to the Dura Retiree Medical Plans. The Debtors' costs vary depending upon medical claims submitted, but in 2005, medical claims totaling $2,400,000 were paid. In 2005, the Debtors paid $54,000 in administrative fees to maintain the Dura Retiree Medical Plans.

In a separate program for retired Employees, the Debtors provide approximately 265 participating retirees with partial Medicare premium reimbursements. As of Aug. 1, 2006, the 2006 annual cost for the Medicare Stipend Program was estimated to be approximately $400,000.

The Debtors also provide Company-sponsored self-insured death benefits for approximately 565 eligible retirees, which benefits range from $1,100 to 6,000 per person.

(vii) Canadian Retiree Medical Programs

All participating vested Canadian employees will be entitled to receive retiree medical and prescription drug benefits upon their retirement from the Company. The Canadian Retiree Medical Plan consists of an active plan insured by Manulife Financial and a closed plan, which is self-insured and for which GreenShields acts as the Debtors' third-party plan administrator.

As of Oct. 30, 2006, approximately 85 currently retired Employees were receiving retiree benefits pursuant to the Canadian Retiree Medical Plan. In 2005, medical claims totaling approximately CDN$265,000 were paid under the Canadian Retiree Medical Plan.

E. Excluded Employee Benefit Plans

The Debtors provide certain deferred compensation plans tocertain of their employees and members of their boards ofdirectors, including the 1979 and 1998 Excel DeferredCompensation Plans, the Dura Supplemental Executive RetirementPlan, and the Atwood Executive Leadership Deferred CompensationPlan.

The Debtors are not requesting authority to continue, assume orreject these Other Deferred Compensation Plans at this time.

F. Additional Employee Benefits

(1) Life Insurance, Accidental Death and Dismemberment Insurance and Optional Life Programs

The U.S. employees receive:

-- primary life insurance coverage, through Unum Provident, for which the Debtors pay approximately $60,000 per month in the aggregate;

-- Accidental Death and Dismemberment Insurance, through Union Provident, for which monthly premiums total approximately $9,000; and

-- optional life programs, the premiums for which are paid by the Employees, and cost approximately $65,000 in the aggregate per month.

The Debtors also provide primary Life Insurance for their Canadian employees through Manulife Financial. All of the Debtors' Canadian employees receive the coverage, which costs the Debtors approximately CDN$175,000 in annual premiums. In addition, the Debtors provide Accidental Death and Dismemberment Insurance to their Canadian Employees through Manulife Financial, for which annual premiums total approximately CDN$20,000.

(2) Disability

The Debtors provide U.S. employees with short-term and long-term disability benefits, paid through a third party administrator, Unum Provident. The approximate cost incurred by the Debtors for short-term disability benefits during the first eight months of 2006 was $700,000 for paid claims plus an additional $2,178 per month in administrative fees. The Debtors' portion of the costs for long-term disability benefits is approximately $30,000 per year.

The Debtors offer their U.S. employees the ability to contribute a portion of their compensation into flexible spending accounts for health and dependent care through NGS American, which operates as a third party administrator to the plans. Approximately 300 U.S. Employees participate in the Flexible Spending Program, which costs the Debtors less than $20,000 per year to administer.

The Debtors also offer the "Flex Perquisite" program for 13 designated senior management Employees, which allows participants to use a prerequisite allowance for certain business benefits that have the most value to the participant. The annual allowances under the Flex Perquisite plan total $269,500 for 2006.

(4) Group Travel Accident Insurance

The Debtors provide accident insurance coverage for Employees while traveling on official company business, which consists of life insurance coverage and business travel assistance coverage, provided by AIG Business Travel Insurance Company. The coverage premiums cost $20,000 per year and are paid through Aug. 1, 2007.

(5) Tuition Reimbursement

Pursuant to a tuition reimbursement program for certain Employees, the Debtors reimburse employees for 100% of tuition costs and registration fees for approved course work at college-level institutions. During the first eight months of 2006, the Debtors have provided Employees with approximately $170,000 of non-taxable tuition benefits and $30,000 of taxable tuition benefits. As of their bankruptcy filing, the Debtors estimate the aggregate amount of reimbursements due under the tuition reimbursement program to be de minimis.

Other Benefits

The Debtors maintain premium-based directors and officers'liability insurance policies and excess liability policies withAmerican International Companies, XL Specialty, Chubb and Axis.The annual premiums for the D&O Policies total approximately$735,000. As of their bankruptcy filing, the Debtors do notbelieve that they owe any premiums for the D&O Policies prior totheir bankruptcy filing.

All of the Debtors' employees are also eligible to receive awardsfor developing patents the Debtors use in their businessoperations. For each patent that issues, a single inventor isprovided with a monetary reward of $1,000, and a total of $2,000is provided to, and shared by, multiple inventors. In addition, afew of the Debtors' employees participate in an expatriateprogram, which provides for benefits to employees they require torelocate overseas.

Rochester Hills, Mich.-based DURA Automotive Systems, Inc.(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seatingcontrol systems, glass systems, engineered assemblies, structuraldoor modules and exterior trim systems for the global automotiveindustry. The company is also a supplier of similar products tothe recreation vehicle and specialty vehicle industries. DURAsells its automotive products to North American, Japanese andEuropean original equipment manufacturers and other automotivesuppliers.

DURA AUTOMOTIVE: Court Gives Final Order for Banks to Honor Checks------------------------------------------------------------------The Honorable Kevin J. Carey of the U.S. Bankruptcy Court for theDistrict of Delaware granted, on a final basis, DURA AutomotiveSystems Inc. and its debtor-affiliates' request, pursuant toSections 105(a), 363(b), 363(c), 507(a) and 1107 of the BankruptcyCode, to:

-- authorize and direct all banks to honor checks for employee wages and salaries prior to the Debtors' filing for chapter 11 protection, and all associated taxes; and

-- prohibit banks from placing any holds on, or attempt to reverse, any automatic transfers to employee accounts for payroll amounts prior to the filing for chapter 11 protection, pending the hearing on the Debtors' "first day" motions and applications in the Chapter 11 cases.

Judge Carey previously directed Bank of America, N.A., whichmaintains the Debtors' master payroll account, not to honor morethan $500,000 in the aggregate on account of the Payroll Checks,unless otherwise ordered by the Court.

Mark D. Collins, Esq., at Richards, Layton & Finger, P.A., inWilmington, Delaware, informed the Court that the Debtors issuedchecks and direct deposits to their salaried employees aggregating$4,790,000 on Oct. 27, 2006, for the pay period endedOct. 31, 2006. The Debtors also issued checks and directeddeposits to their hourly employees totaling $3,150,000 onOct. 27, 2006, for the pay period ended Oct. 20, 2006.

Given the relatively brief period of time between theOct. 27, 2006 payroll and the date they filed for bankruptcy, theDebtors believe that many of the employee checks had not clearedas of their bankruptcy filing. Nevertheless, since approximately90% of these payments were made via direct deposit, the Debtorsestimate that no more than $500,000 in Payroll Checks, beforetheir bankruptcy filing, remains outstanding.

The Debtors were wary that the Banks would not honor outstandingPayroll Checks absent a Court order authorizing the payment. TheDebtors maintain that, at this critical juncture in their cases,it is essential that the employee-workforce remains in place andproperly motivated.

According to Mr. Collins, if the Debtors fail to meet theirpayroll, the employees would have little incentive to remain onthe job. Even if the employees do not leave their jobs, theDebtors' failure to meet payroll obligations will have asignificant detrimental effect on employee morale and thus reducethe employees' willingness to aid in the restructuring of theDebtors through a successful reorganization of the Debtors'business, he asserted.

Rochester Hills, Mich.-based DURA Automotive Systems, Inc.(Nasdaq: DRRA) -- http://www.DURAauto.com/-- is an independent designer and manufacturer of driver control systems, seatingcontrol systems, glass systems, engineered assemblies, structuraldoor modules and exterior trim systems for the global automotiveindustry. The company is also a supplier of similar products tothe recreation vehicle and specialty vehicle industries. DURAsells its automotive products to North American, Japanese andEuropean original equipment manufacturers and other automotivesuppliers.

ENRON CORP: Court Okays $44 Million Dynegy Settlement Agreement---------------------------------------------------------------The Honorable Arthur Gonzalez of the U.S. Bankruptcy Court for theSouthern District of New York approved the $44 million SettlementAgreement between Enron Corp. and its debtor-affiliates and DynegyInc. and its affiliates, relating to the Guarantee Litigation andthe Dynegy Adversary Proceeding.

Melanie Gray, Esq., at Weil, Gotshal & Manges LLP, in New York,relates that the MNA purported to create cross-product and cross-affiliate netting and set-off rights as to the underlyingobligations among all the Dynegy Parties and Enron Parties undertheir respective trading agreements, or Underlying MasterAgreements. The MNA also seeks to aggregate claims and debtsamong the Enron Parties and the Dynegy Parties, which means theclaims and debts would be reduced to a singular amount due fromthe Dynegy Parties to the Enron Parties or vice versa. Inaddition, Enron provided the Dynegy Parties with the EnronGroup Guarantee Agreement, which guaranteed all of the EnronParties' obligations under the MNA.

On Oct. 15, 2002, the Dynegy Parties filed Claim Nos. 13397,13398, 13399, 13400, 13401, 13402 and 13403 against the EnronDebtors, with each claim amounting to $93,558,630. The DynegyParties argued that the Claims are due under the Enron Guarantee.Before filing their Claims, the Dynegy Parties filed a requestfor relief from the automatic stay to enforce the MNA andcommence arbitration against the Enron Debtors.

The Enron Parties objected to the Dynegy Parties' stay reliefmotion and moved to enjoin the Arbitration Proceeding. The Courtsubsequently granted the Enron Parties' request.

The parties eventually agreed that the Guaranty Litigation wouldultimately be consolidated in the Dynegy Adversary Proceeding.

According to Ms. Gray, as a result of the Dynegy AdversaryProceeding and other orders entered by Judge Gonzalez, the EnronDebtors hold reserves related to $1,144,320,954 of disputedclaims for the benefit of the Dynegy Parties in the DisputedClaims Reserve.

After negotiations, the parties reached a settlement agreement.The terms of the settlement are:

(1) they will release each other from all claims, obligations, demands, actions, causes of action, and liabilities arising from any event, transaction, matter and circumstance related to the Guarantee Litigation and the Dynegy Adversary Proceeding;

(2) the Dynegy Parties will make a $44,000,000 settlement payment to the Enron Parties;

(3) the Dynegy Claims will be deemed irrevocably withdrawn, with prejudice, and to the extent applicable, expunged; and

(4) After actual receipt of the settlement payment, the Enron Parties will enter into stipulations with the Dynegy Parties, dismissing with prejudice the Dynegy Adversary Proceeding, the Guarantee Litigation, and all claims and counterclaims related to the Adversary Proceeding and the Guarantee Litigation.

The partnership reported net income of $208 million for the thirdquarter of 2006, a 59% increase from net income of $131 million,in the third quarter of 2005. Net income for the third quarter of2006 includes approximately $50 million of cash proceeds frombusiness interruption insurance claims associated with HurricanesKatrina and Rita in 2005 and Hurricane Ivan in 2004.

This benefit was partially offset by charges in the third quarterof 2006 for a non-cash impairment of the investment in certainoffshore natural gas pipelines for $7.4 million and a $6.6 millionloss related to the contracted replacement of cushion natural gasat the partnership's Wilson natural gas storage facility that isundergoing mechanical repairs.

Revenue for the third quarter of 2006 increased 19%, to$3.9 billion compared to $3.2 billion for the third quarter of2005. Operating income for the third quarter of 2006 increased41% to $274 million compared to $194 million for the third quarterof 2005. Gross operating margin increased 28% to $400 million forthe third quarter of 2006 from $312 million for the same quarterin 2005.

"During the third quarter, our expansive network of pipelinestransported a record 2 million barrels per day of NGLs, crude oiland petrochemicals and over 7.6 trillion Btus of natural gas. Ourfractionation, isomerization and octane enhancement facilitiesprocessed almost 500,000 barrels per day of hydrocarbons - anotherrecord.

"The 28% increase in gross operating margin for the quarter wasled by strong contributions from three of our four businesssegments. These results reflect a robust global economy and strongdemand for crude oil, NGLs and natural gas. Further, we benefitedfrom the continued high level of drilling and resulting productionincreases in the supply basins we serve, a favorable natural gasto crude oil ratio which impacted processing and fractionationmargins, improved performance in the offshore area as hurricanerepairs were completed and the overall impact of many of ourorganic growth projects and acquisitions completed in 2005 and2006.

"Our distributable cash flow for the quarter exceeded the declaredcash distributions to partners by approximately $76 million.Consistent with our long-term value creation strategy, we willretain this surplus in the partnership to invest in our attractiveportfolio of organic growth projects and bolt-on acquisitions andto reduce debt.

"In the two full years since we have completed the merger withGulfTerra Energy Partners, Enterprise has generated over $1.8billion in distributable cash flow, increased our cashdistribution rate to partners by 16.5% and reinvestedapproximately $300 million of excess distributable cash in thegrowth of the partnership. Since Enterprise's initial publicoffering in 1998, we have managed our cash flow to provide ourunitholders with an attractive rate of cash distribution growthwhile reinvesting cash in the partnership to enhance our financialflexibility, reduce the need to access the equity markets and toincrease the long-term value of our partnership units," stated Mr.Phillips.

"During the first nine months of this year, we have completedsignificant steps to raise the equity capital to front-end loadand support our growth capital budget for 2006 and 2007. In total,we have raised over $1.1 billion of capital through the issuanceof common units, the equity content ascribed by the ratingagencies to our issuance of the $550 million of JuniorSubordinated notes due 2066, and distributable cash flow that hasbeen reinvested in the partnership. As a result, we finished thequarter with approximately $1.3 billion in liquidity and in astrong financial position from which to execute our current growthplans for 2006 and 2007," Mr. Phillips concluded.

Judge Walsh authorizes the Debtors to compensate SpencerStuart$100,000, in full satisfaction of the fees and expenses itincurred, on a final basis.

As reported in the Troubled Company Reporter on July 4, 2006,SpencerStuart will assist the Debtors' three-member searchcommittee in identifying and hiring the Debtors' permanentpresident and chief executive officer in accordance with thecriteria to be developed by the Search Committee, seniormanagement and advisors.

FOAMEX INTERNATIONAL: Court Okays Hepbron Settlement Agreement--------------------------------------------------------------The U.S. Bankruptcy Court for the District of Delaware approvesFoamex International Inc. and its debtor-affiliates' SettlementAgreement with Hepbron Vending and Food Services Inc.

As reported in the Troubled Company Reporter on Nov. 14, 2006, theparties have agreed to resolve the issues between them withrespect to the Civil Action and Claim No. 833.

In a settlement agreement, the parties agree that:

(a) Foamex will allow Hepbron a general unsecured claim for $2,500, which liquidates Claim No. 833; and

(b) the parties will mutually release each other from any and all claims or actions in connection with the Civil Action or the Claim.

GADZOOKS INC: Judge Hale Approves Equity Committee Counsel's Fees-----------------------------------------------------------------Hughes and Luce, LLP, serving as counsel to the Official Committeeof Equity Security Holders in Gadzooks, Inc., filed its finalapplication for compensation, seeking approval of approximately$950,000 in fees and expenses. William Kaye, the LiquidatingTrustee and successor to the Official Committee of UnsecuredCreditors objected.

In a decision published at 2006 WL 2854388, the Honorable HarlinDeWayne Hale holds that counsel for a committee of equity securityholders can receive a professional fee award under the BankruptcyCode for the services that were provided prior to the date onwhich it became clear that the committee's proposed plan would notbe confirmed, regardless of whether counsel could show an"identifiable, tangible, and material benefit" to the Chapter 11estate. Further, Judge Hale finds the services were reasonableand necessary when rendered, the work was beneficial to the estatewhen performed, and, based upon its complexity, the work wasperformed in a timely manner and at rates customarily charged bycomparably skilled practitioners. Judge Hale rejected the notionthat professional fees could be judged in hindsight.

Headquartered in Carrollton, Texas, Gadzooks, Inc. --http://www.gadzooks.com/-- is a mall-based specialty retailer providing casual apparel and related accessories for youngsters,between the ages of 14 and 18. The Company filed for chapter 11protection on February 3, 2004 (Bankr. N.D. Tex. Case No. 04-31486). Charles R. Gibbs, Esq., and Keith Miles Aurzada, Esq., atAkin Gump Strauss Hauer & Feld, LLP, represent the Debtor in itsrestructuring efforts. When the Company filed for protection fromits creditors, it listed $84,570,641 in total assets and$42,519,551 in total debts. The Honorable Harlin DeWayne Haleconfirmed the First Amended Joint Plan of Liquidation filed byGadzooks, Inc., and its Official Committee of Unsecured Creditorson Feb. 6, 2006.

GAP INC: Earns $189 Million in Quarter Ended October 28-------------------------------------------------------Gap Inc. reported net earnings for the third quarter ended Oct.28, 2006, of $189 million, compared with $212 million, for thesame period last year.

Third quarter net sales were $3.9 billion, compared with$3.9 billion for the same period last year. Comparable storesales decreased 5%, compared with a 7% decrease for the sameperiod last year.

"Our third quarter results reflect that each brand is at adifferent stage in its turnaround," said Paul Pressler, presidentand CEO. "We are pleased with the solid performance at BananaRepublic and continued progress each month of the quarter at Gapbrand; however, Old Navy's results were disappointing. Headinginto the holiday season, our teams are focused on driving strongexecution."

The company disclosed that it ended the third quarter with$2.4 billion in cash and short-term investments. T his represents$1.9 billion more in cash and investments than total debt. Forthe 39 weeks ended Oct. 28, 2006, free cash flow was an inflow of$214 million, compared with an outflow of $120 million last year.The increase was driven primarily by reductions in workingcapital. The company still expects to generate at least $800million in free cash flow in fiscal 2006.

On Aug. 3, 2006, the company's Board of Directors authorized$750 million for its share repurchase program in addition to the$500 million authorization that was announced at the beginning offiscal year 2006.

During the third quarter, the company repurchased 16 millionshares for $271 million. As of Nov. 15, 2006, the company hasutilized $344 million of its $750 million authorization, for atotal of 20 million shares repurchased. At the end of the thirdquarter, the company's outstanding shares were 822 million.

The company paid a dividend of $0.08 per share in the thirdquarter, compared with a dividend of $0.045 per share in the sameperiod last year.

The company reported that inventory per square foot was flat atthe end of the third quarter compared with a 7% decline in thethird quarter of the prior year. The% increase in inventory persquare foot at the end of the fourth quarter is still expected tobe in the low-single digits, compared with an 11% decrease lastyear.

Inventory per square foot at the end of the first quarter offiscal 2007 is expected to be flat, compared with a 5% decrease inthe first quarter of the prior year.

The company's growth strategy is to build and expand its brandsthrough new product categories and through international, onlineand real estate growth. In the third quarter, Banana Republiccontinued its expansion in Japan, and the first Gap franchisestores opened in Singapore and Malaysia.

The company has built a world-class online business, with theOctober launch of Piperlime (an online shoe business) being themost recent example. An additional 10 new Forth & Towne storesopened in the third quarter.

Through Oct. 28, 2006, the company opened 160 store locations andclosed 56 store locations. Net square footage for the thirdquarter increased 2% compared to a 3% increase the same periodlast year. For fiscal 2006, the company still expects to openabout 190 store locations and to close about 125 store locations.Net square footage is still expected to increase between 2 and 3%for fiscal 2006.

About Gap Inc.

Gap Inc. -- http://www.gapinc.com/-- is an international specialty retailer offering clothing, accessories and personalcare products for men, women, children and babies under the Gap,Banana Republic, Old Navy, Forth & Towne and Piperlime brandnames. Gap Inc. operates more than 3,100 stores in the UnitedStates, the United Kingdom, Canada, France, Ireland and Japan. Inaddition, Gap Inc. is expanding its international presence withfranchise agreements for Gap and Banana Republic in Southeast Asiaand the Middle East.

* * *

As reported in the Troubled Company Reporter on Nov. 21, 2006,Standard & Poor's Ratings Services lowered its corporate creditand senior unsecured ratings on San Francisco-based The Gap Inc.to 'BB+' from 'BBB-'. The outlook is stable.

GENTEK INC: Earns $2.9 Million in Third Quarter of 2006--------------------------------------------------------GenTek Inc reported $2.9 million net income on $225 million ofrevenues for the third quarter ended Sept. 30, 2006, compared with$1.3 million net income on $209.1 million of revenues for the sameperiod in 2005.

The increase in revenues was primarily due to higher sales of$10 million in the performance chemicals segment as a result ofbroad based strength across all end markets, and higher sales of$6 million in the manufacturing segment as a result of highersales in the appliance and electronics market and the automotivemarket. The increase in sales in the automotive market is due tothe acquisition of Precision Engine Products in the third quarter.

At Sept. 30, 2006, the company's balance sheet showed$766.9 million in total assets, $668.4 million in totalliabilities and $98.5 million in total stockholders' equity.

Full-text copies of the company's consolidated financialstatements are available for free at:

On Sept. 21, 2006, the company acquired the assets of GACMidAmerica, Inc., for a total purchase price of $8.28 million.The acquisition included manufacturing facilities in Toledo, Ohio,Indianapolis, Indiana, and Saukville, Wisconsin. GAC producesaluminum sulfate and bleach, as well as distributing specialtywater treatment chemicals, sulfuric acid and caustic soda.

On July 31, 2006, the company acquired the assets of PrecisionEngine Products Corp., a wholly owned subsidiary of StanadyneCorp. for a purchase price of $25,762,000 in cash, plus thepotential of an earn out for Stanadyne of $10,000,000 twelvemonths later, based on certain performance metrics being achievedpost closing. Precision manufactures hydraulic lash adjusters anddie cast aluminum rocker arm assemblies.

On July 27, 2006, the company acquired the assets of RepaunoProducts, LLC, for $5,812,000. Repauno manufactures sodiumnitrite which is used in a wide range of industries includingmetal finishing, heat transfer salts, rubber processing, meatcuring, odor control and inks and dyes.

About GenTek Inc.

GenTek Inc. -- http://www.gentek-global.com/-- provides specialty inorganic chemical products and services for treating water andwastewater, petroleum refining, and the manufacture of personal-care products, valve-train systems and components for automotiveengines and wire harnesses for large home appliance and automotivesuppliers. GenTek operates over 60 manufacturing facilities andtechnical centers and has approximately 6,900 employees

GLOBAL HOME: Can Use Madeleine's Cash Collateral Until February 28------------------------------------------------------------------ The U.S. Bankruptcy Court for the District of Delaware gaveGlobal Home Products LLC and its debtor-affiliates authorityto continue using the cash collateral securing repayment oftheir obligations to Madeleine LLC until Feb. 28, 2007.

The Debtors' authority to use the cash collateral expiredon Oct.31, 2006.

The Debtors will use the funds to meet payroll and other operatingexpenses and to maintain vendor support.

Madeleine is a creditor holding approximately $200,000,000 insecured claims. As adequate protection, the Debtors grantMadeleine a valid, perfected and enforceable lien upon all oftheir assets and superpriority administrative claim over any andall administrative expenses.

GRANT PRIDECO: Earns $126.5 Million in 2006 Third Quarter----------------------------------------------------------Grant Prideco, Inc. reported a $126.5 million net income on$451.3 million of revenues for the quarter ended Sept. 30, 2006,compared with a $48.1 million net income on $352.2 million ofrevenues for the same period in 2005.

* the Drilling Products and Services business segment of $61.2 million,

* the Drill Bits segment of $27.9 million, and

* the Tubular Technology and Services segment of $9.2 million.

In addition, the company recognized a $20 million License andRoyalty Income in view of the technology licensing agreement itsigned with a competitor to use ReedHycalog's patented technologyfor the shallow leaching of PDC cutters in exchange for$20 million in guaranteed non-refundable and non-cancelablepayments and future royalty payments.

At Sept. 30, 2006, the company had:

* cash of $98.0 million, * short-term investments of $6.0 million, * working capital of $636.6 million and * unused borrowing availability of $341.4 million

This compares to:

* cash of $28.2 million, * working capital of $479.6 million and * unused borrowing availability of $330.6 million,

at Dec. 31, 2005.

At Sept. 30, 2006, the company's balance sheet showed $1.8 billionin total assets, $556.6 million in total liabilities, $15 millionin minority interests, and $1.2 billion in total stockholders'equity.

Full-text copies of the company's consolidated financialstatements are available for free at:

On Oct. 13, 2006, the company acquired Anderson Group Limited andrelated companies for $115.7 million plus the assumption of netdebt of approximately $39.9 million. The company funded theacquisition with cash on hand and a draw under its creditfacility.

Anderson, headquartered in Aberdeen, Scotland, providesspecialized downhole drilling tools, including the AnderReamer andAG-itator, and provides services related to these tools.

Stock Repurchase Program

In October 2006, the company's Board of Directors approved anincrease in its stock repurchase program by $200 million, to$350 million from $150 million. The company may repurchase itsshares in the open market based on, among other things, itsongoing capital requirements and expected cash flows, the marketprice and availability of its stock, regulatory and otherrestraints and general market conditions. The repurchase programdoes not have an established expiration date.

Headquartered in Houston, Texas, Grant Prideco Inc. provides drillbits and related equipment. The company also makes engineeredtubular products for oil field exploration and development,including drill pipe and drill stem products, large-diametercasings, tubing and connections, and risers. Grant Prideco offerssales, technical support, repair, and field services to customersworldwide. The company was spun off by drilling equipment makerWeatherford International in 2000.

* * *

As reported in the Troubled Company Reporter on Sept. 29, 2006,Moody's Investors Service confirmed its Ba1 Corporate FamilyRating for Grant Prideco Inc., in connection with Moody'simplementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the oilfield service and refiningand marketing sectors. Moody's also affirmed its Ba1 rating onthe company's 6.125% Senior Unsecured Guaranteed Global Notes Due2015 and assigned the debentures an LGD4 rating suggestingnoteholders will experience a 55% loss in the event of a default.

Third quarter operating revenues increased 17.3% to $141.7 millionfrom $120.8 million in the prior year, principally due to theapplication of purchase accounting, which resulted in the deferralof revenue from its directories business in last year's reporting.

After adjusting for purchase accounting, third quarter operatingrevenues would have declined 3.2% annually. As compared to thesecond quarter 2006, operating revenues were approximately 2.1%lower.

"Our third quarter performance is not reflective of the progressand investment we have made to position Hawaiian Telcom to deliverinnovation and value to the marketplace," Michael Ruley, HawaiianTelcom's chief executive officer, commented. "Last month welaunched the Company's first product bundles that provideunlimited local, long distance and dedicated high speed Internetservice. We still have significant progress to make on thesystems front to improve our operational productivity andstrengthen our controls environment, but we will continue toselectively roll out products and services to take advantage ofopportunities we see in the marketplace."

Quarterly highlights for the company include:

-- Adjusted EBITDA was $48.6 million.

-- Transition costs and other cost structure changes incurred in the third quarter were $3.4 million.

-- Access lines declined 1.8% sequentially to 615,300, as compared to the second quarter 2006 decline of 2.0%. The annual access line decline was 5.5%.

"The third quarter was a challenging one for the company onseveral fronts and there remains a lot of hard work ahead toovercome the cutover related systems issues we still face." saidMichael Ruley, Hawaiian Telcom's chief executive officer. "Wecontinue to make progress, but we are not satisfied with the paceof that improvement, so we have brought onboard significantexternal resources to assist us in meeting the needs of ourcustomers, improving systems functionality, and strengthening ourinternal controls. Resolving these matters is the company'snumber one near term priority."

Operating expenses for third quarter 2006 were $154.7 millioncompared with $150.7 million in the prior year. The year overyear increase was primarily related to changes in the Company'scost structure. Sequentially, operating expenses increased 5.7%from $146.3 million in the second quarter 2006. The increase isprimarily due to an increase in reserves for uncollectibleaccounts and higher wireline activation costs as a result of achange in estimate, partially offset by lower compensation costs.

Hawaiian Telcom had drawn $142.0 million under its revolvingcredit facility, down from $149.0 million at the end of the secondquarter, and has $57.8 million available, subject to covenants.The Company generated cash of approximately $15.9 million in thethird quarter from operating and investing activities, includingpayments for the transition costs mentioned earlier. Reportedcapital expenditures were $17.8 million for the third quarter.

About Hawaiian Telcom

Hawaiian Telcom is a telecommunications provider offering a widespectrum of telecommunications products and services, whichinclude local and long distance service, high-speed Internet,wireless services, and print directory and Internet directoryservices.

* * *

As reported in the Troubled Company Reporter on Nov. 23, 2006,Moody's Investors Service placed all debt ratings of HawaiianTelcom Communications, Inc., including its B1 Corporate FamilyRating, on review for possible downgrade and downgraded thecompany's speculative grade liquidity rating to SGL-4 from SGL-3.

As reported in the Troubled Company Reporter on Nov .20, 2006,Standard & Poor's Ratings Services placed its ratings on HawaiianTelcom Communications Inc., including its 'B' corporate creditrating, on CreditWatch with negative implications

As reported in the Troubled Company Reporter on July 25, 2006, theCompany and the investor group executed a definitive mergeragreement in a transaction valued at approximately $33 billion,including the assumption or repayment of approximately$11.7 billion of debt.

Under the terms of the agreement, HCA stockholders will receive$51 in cash for each share of HCA common stock they hold,representing a premium of approximately 18% to HCA's closing shareprice on July 18, 2006, the last trading day prior to pressreports of rumors regarding a potential acquisition of HCA.

"We are very pleased to partner with a group of experiencedinvestors who share our commitment to maintaining HCA's 'patientsfirst' culture by continuing to focus on quality care andinvesting substantial resources into our facilities," said Jack O.Bovender, Jr., Chairman and Chief Executive Officer of HCA. "Webelieve this provides a good return to our shareholders andeffectively positions our company for continued growth andsuccess."

HCA common stock ceased trading on the New York Stock Exchange atmarket close on Nov. 17, 2006, and will no longer be listed.

About Bain Capital

Bain Capital -- http://www.baincapital.com/-- is a private investment firms, with over 20 years of experience in managementbuyouts, and offices in Boston, New York, London, Munich, HongKong, Shanghai and Tokyo.

Headquartered in Nashville, Tennessee, HCA (Hospital Corporationof America) Inc. (NYSE: HCA) -- http://www.hcahealthcare.com/-- is a healthcare services provider, composed of locally managedfacilities that include approximately 182 hospitals and 94outpatient surgery centers in 22 states, England and Switzerland.At its founding in 1968, HCA was one of the nation's firsthospital companies.

* * *

As reported in the Troubled Company Reporter on Nov. 22, 2006,Fitch downgraded and removed from Rating Watch Negative HCA,Inc.'s existing ratings as a result of the completion of itsleveraged buyout. Fitch's rating action includes a downgrade ofthe company's Issuer Default Rating to 'B' from 'BB+' and adowngrade of its senior unsecured notes to 'CCC+/RR6' from 'BB+'.Fitch has also withdrawn the 'BB+' rating on the Unsecured BankFacility.

As reported in the Troubled Company Reporter on Nov. 22, 2006,Moody's Investors Service downgraded the ratings of the seniorunsecured notes assumed in the capital structure of HCA Inc. toCaa1 from Ba2 after the closing of the leveraged buyout of thecompany.

HOME FRAGRANCE: Panel Hires Thomas Henderson as Bankruptcy Counsel------------------------------------------------------------------The Honorable Karen K. Brown of the U.S. Bankruptcy Court for theSouthern District of Texas in Houston authorized the OfficialCommittee of Unsecured Creditors of Home Fragrance Holdings Inc.to retain Thomas S. Henderson, Esq., as its bankruptcy counsel.

Mr. Henderson is expected to:

a) advise the Committee with respect to its powers and duties;

b) advise the Committee with respect to the rights and remedies of the estate's creditors and other parties in interest;

c) review the Debtor's assets, liabilities and prior financial transactions to determine if potential recoveries may exist for the benefit of the unsecured creditors of the Debtor's estate.

d) conduct appropriate examinations of witnesses, the Debtor, claimants and other parties in interest;

e) prepare all appropriate pleadings and other legal instruments required to be filed in this case;

f) represent the Committee in all proceedings before the Court and in any other judicial or administrative proceedings in which the rights of the Committee or the estate may be affected;

g) advise the Committee in connection with the formulation, solicitation, confirmation and consummation of any plan(s) of reorganization which the Debtor or another party may propose; and

h) perform any other legal services that may be appropriate in connection with the continued representation of the interest of the unsecured creditors herein.

Mr. Henderson will charge $375 per hour for this engagement.

Mr. Henderson assured the Court that he is a "disinterestedperson" as that term is defined in Section 101(14) of theBankruptcy Code.

c) conduct a thorough business review of the Debtor, including a review of the Debtor's financial condition, a creditor analysis, a strategic positioning analysis, an analysis of the Debtor's short-term needs, an analysis of its organizational structure, and a cost analysis to determine the proper approach for maximizing the Debtor's value and protecting the payments from the U.S. Bureau of Customs and Border Enforcement pursuant to the Continued Dumping and Subsidy Offset Act of 2000;

d) build computer models to forecast cash and historical trends as well as various liquidation scenarios for the Debtor;

e) meet with the Debtor's creditors and its shareholders as necessary;

f) assist the Debtor's counsel in preparing the Debtor's schedules and statements of financial affairs as well as any other court documents required during the course of the bankruptcy case;

g) provide testimony on the Debtor's behalf before the Bankruptcy Court, if necessary;

h) assist the Debtor's management and its counsel in developing a plan of liquidation;

i) manage the Debtor's cash flow and vendor relations as the Debtor's Board or its management may request;

j) negotiate with authorities on permits and other issues; and

k) develop and manage a plan to sell the Debtor's assets, which would include, without limitation:

* developing list of potential purchasers;

* developing a "Teaser" memo;

* managing potential buyers and organizing the deal process;

* coordinating and organizing access to an electronic data room to any onsite data room; and

William Schoner, the Debtor's chief financial officer, disclosesthat David Hull, also a partner at CRP, will assist Mr. Martin.William Snyder, managing manager of CRP, will aid Mr. Martin andMr. Hull as necessary.

Mr. Schoner further discloses that Mr. Martin's and Mr. Hull'shourly rates are $350 and $300, respectively. Mr. Snyder charges$400 per hour for his services.

Mr. Schoner assures the Court that that CRP is a "disinterestedperson" as the term is defined in Section 101(14) of theBankruptcy Code and does not hold or represent any interestadverse to the Debtors' estates.

HORNBECK OFFSHORE: Earns $23.9 Million in 2006 Third Quarter------------------------------------------------------------Hornbeck Offshore Services Inc. reported a $23.9 million netincome on $77.5 million of revenues for the third quarter endedSept. 30, 2006, compared with a $9.4 million net income on$46.5 million of revenues for the same period in 2005.

The increase in net income in the third quarter of 2006 comparedto the same period in 2005 was primarily due to the increase inrevenues in the third quarter of 2006. Revenues for the threemonths ended Sept. 30, 2006 were $31.0 million, or 66.8%, higherthan the same period in 2005 due to stronger market conditions inthe United States Gulf of Mexico for services provided by offshoresupply vessels and tugs and tank barges, in addition to increasingdemand for barge transportation services in the northeasternUnited States. Revenues also increased due to the incrementalcontribution of three double-hulled tank barges under thecompany's first tug and tank barge newbuild program placed intoservice during the fourth quarter of 2005 and a shore-basedfacility acquired in December 2005.

At Sept. 30, 2006, the company had cash and cash equivalents of$310.6 million.

At Sept. 30, 2006, the company's balance sheet showed $911.9million in total assets, $416.6 million in total liabilities, and$495.3 million in total stockholders' equity.

Full-text copies of the company's consolidated financialstatements for the quarter ended Sept. 30, 2006, are available forfree at:

Based in Covington, Louisiana, Hornbeck Offshore Services Inc.-- http://www.hornbeckoffshore.com/-- through its subsidiaries, provides offshore supply vessels for the offshore oil and gasindustry primarily in the United States Gulf of Mexico andinternationally.

* * *

As reported in the Troubled Company Reporter on Nov. 17, 2006,Moody's Investors Service affirmed Hornbeck Offshore ServicesInc.'s Ba3 corporate family rating, Ba3 Probability of DefaultRating, Ba3 and LGD4, 55% senior unsecured note ratings, andchanged the outlook from stable to negative.

HOUSE OF MERCY: Bankr. Ct. Won't Interfere in Medicare Dispute--------------------------------------------------------------House of Mercy, Inc., sued for reinstatement of its Medicareprovider number and reimbursement of $486,687.23 of claims thatallegedly became due before its provider number was revoked. TheCenters for Medicare & Medicaid Services moved to dismiss. In adecision published at 2006 WL 2819646, the Honorable Henley A.Hunter held that the bankruptcy court did not have jurisdiction tohear the debtor's claims, even its Fifth Amendment due processclaims, given that debtor had never requested a hearing on theMedicare revocation decision, and thus had not exhausted itsadministrative remedies as required by Medicare statutes.

House of Mercy, Inc., filed for chapter 11 protection on November3, 2004 (Bankr. W.D. La. Case No. 04-52697). The Debtor operated ahealthcare business as a supplier of wheelchairs or "durablemedical equipment or 'DME,' prosthetics, orthotics and supplies"(DMEPOS supplier), as regulated by Medicare under a Medicareprovider number. Six days after the bankruptcy filing, the Centerfor Medicare Services revoked the debtor's provider number sayingthat an audit showed House of Mercy to be in violation of sevenout of twenty-one provider requirements. Stephen D. Wheelis,Esq., at Wheelis & Rozanski in Alexandria, La., represents thedebtor.

INDEPENDENCE TAX: Sept. 30 Balance Sheet Upside-Down by $2.5 Mil.-----------------------------------------------------------------Independence Tax Credit Plus LP reported a $1.53 million net losson $5.6 million of revenues for the quarter ended Sept. 30, 2006,compared with a $1.54 million net loss on $5.4 million of revenuesfor the same period in 2005.

At Sept. 30, 2006, the limited partnership's balance sheet showed$128.1 million in total assets, $125.3 million in totalliabilities, $5.3 million in minority interests, resulting in apartners' deficit of $2.5 million.

Rental income remained fairly consistent with an increase ofapproximately 2% for the quarter ended Sept. 30, 2006 comparedwith the corresponding period in 2005, primarily due to rentalrate increases offset by a decrease in occupancy at one subsidiarypartnership. Other income increased approximately $59,000 for thequarter ended Sept. 30, 2006, primarily due to the receipt ofinsurance proceeds in 2006 resulting from a fire in 2005 at onesubsidiary partnership, an increase in tenant charges and laundryincome at a second subsidiary partnership and an increase in cableservice fees at a third subsidiary partnership offset by thereceipt of insurance proceeds to cover fire damages in the prioryear at a fourth subsidiary partnership.

Total expenses, excluding operating, remained fairly consistentwith an increase of less than 1% for the quarter ended Sept. 30,2006 as compared to the corresponding period in 2005.

Operating expense increased approximately $42,000 for the quartermonths ended Sept. 30, 2006 as compared to the correspondingperiod in 2005, primarily due to increases in gas charges at threesubsidiary partnerships, an increase in heating costs at a fourthsubsidiary partnership and an increase in water and sewer chargesat a fifth subsidiary partnership.

Full-text copies of the limited partnership's third quarterfinancial statements are available for free at:

On July 1, 1991, the company commenced a public offering ofBeneficial Assignment Certificates representing assignments oflimited partnership interests in the company. The companyreceived $76,786,000 of gross proceeds from Offering from 5,351investors and no further issuance of these certificates isanticipated. As of Sept. 30, 2006, the company has invested allof its net proceeds in 28 other partnerships. Approximately$8,600 of the purchase price remains to be paid to the otherpartnerships(all of which is held in escrow).

The company and Beneficial Assignment Certificates holders beganto recognize the tax credits with respect to a property when theperiod of the company's entitlement to claim tax credits (for eachproperty generally ten years from the date of investment or, iflater, the date the property is placed in service) for suchproperty commenced. Because of the time required for theacquisition, completion and rent-up of properties, the amount oftax credits per Certificate gradually increased over the firstthree years of the company's existence. Tax credits notrecognized in the first three years will be recognized in the 11ththrough 13th years. The company generated $17,573, $1,051,548 and$7,001,508 of tax credits during the 2005, 2004 and 2003 taxyears, respectively.

About Independence Tax

Independence Tax Credit Plus LP is a limited partnership which hasinvestments in 28 other subsidiary partnerships owning leveragedcomplexes that are eligible for the low-income housing tax credit.The company's investment in each of these other partnershipsrepresents from 98% to 98.99% of the company's interests in theseother partnerships.

Opa-Locka, one of the subsidiary partnerships, is in default onits third and fourth mortgage notes and continues to incursignificant operating losses. Independence Tax Credit'sinvestment in Opa-Locka at Sept. 30, 2006, was approximately$2,902,000.

INDEPENDENCE TAX II: Sept. 30 Balance Sheet Upside-Down by $4.9MM-----------------------------------------------------------------Independence Tax Credit Plus L.P. II reported a $1.1 million netloss on $2.45 million of revenues for the second fiscal quarterended Sept. 30, 2006, compared with a $1 million net loss on$2.5 million of revenues for the same period in 2005.

At Sept. 30, 2006, the limited partnership showed $77.4 million intotal assets, $83.4 million in total liabilities, and $1 millionin minority interests, resulting in a $4.9 million partner'sdeficit.

Rental income decreased approximately 3% for the quarter endedSept. 30, 2006 as compared to the same period in 2005, primarilydue to a drop in occupancy resulting from damages caused byHurricane Katrina at one subsidiary partnership, offset byincreases in rental rates of other subsidiary partnerships.

Other income increased approximately $23,000 for the quarter endedSept. 30, 2006 primarily due to insurance proceeds received forhurricane damages at one subsidiary partnership.

Total expenses, excluding operating, remained fairly consistentwith variances of less than 1% for the quarter ended Sept. 30,2006 as compared to the same period in 2005.

Operating expenses increased approximately $40,000 for the quarterended Sept. 30, 2006, as compared to the same period in 2005,primarily due to increased gas and water costs at one subsidiarypartnership and increased heat, gas and electricity costs at asecond subsidiary partnership.

On Jan. 19, 1993, the Partnership commenced a public offering ofBeneficial Assignment Certificates representing assignments oflimited partnership interests in the company. The companyreceived $58,928,000 of gross proceeds from the offering from3,475 investors. The offering was terminated on April 7, 1994.As of September 30, 2006, the Partnership has invested all ofits net proceeds in fifteen subsidiary partnerships.

Approximately $282,000 of the purchase price remains to be paid tothe subsidiary partnerships (including approximately $24,000 beingheld in escrow).

The tax credits are attached to a subsidiary partnership forthe 10 year credit period and are transferable with the propertyduring the entirety of such 10 year period. If trends in the realestate market warranted the sale of a property, the remaining taxcredits would transfer to the new owner, thereby adding value tothe property on the market. However, such value declines eachyear and is not included in the financial statement carryingamount. The credit periods are scheduled to expire at varioustimes through Dec. 31, 2007 with respect to the subsidiarypartnerships depending upon when the credit period commenced.The Partnership generated $4,827,456, $8,384,145 and $8,746,267 oftax credits during each of the 2005, 2004 and 2003 tax years,respectively.

About Independence Tax Credit Plus II

Independence Tax Credit Plus II is a limited partnership formedunder the laws of Delaware on February 11, 1992. Its generalpartner Related Independence Associates L.P. is an affiliate ofCharterMac Capital LLC. At Sept. 30, 2006, the partnership hassubsidiary interests in fifteen other limited partnerships owningleveraged apartment complexes that are eligible for the low-incomehousing tax credit. The company's investment in each subsidiarypartnership represents 98.99% of the company's interests in theseother partnerships.

INSIGHT COMMS: Posts $7.7 Million Net Loss in 2006 Third Quarter---------------------------------------------------------------- Insight Communications Co. Inc. reported a net loss of$7.7 million on $318.1 million of revenues for the third quarterended Sept. 30, 2006, compared with a $7.4 million net loss on$279 million of revenues for the same period in 2005.

Revenue for the quarter ended Sept. 30, 2006 increased 14% overthe prior year, due primarily to customer gains in all services,as well as video rate increases.

Insight Communications (NASDAQ: ICCI) is the 9th largest cableoperator in the United States, serving approximately 1.3 millioncustomers in the four contiguous states of Illinois, Indiana,Ohio, and Kentucky. Insight specializes in offering bundled,state-of-the-art services in mid-sized communities, deliveringanalog and digital video, high-speed Internet, and voice telephonyin selected markets to its customers.

INTERSTATE BAKERIES: Sells Seattle Asset to Laukkonen for $1.3MM----------------------------------------------------------------Interstate Bakeries Corporation and its debtor-affiliatesconducted an auction on Nov. 6 to sell their interest in aproperty located at 14701 15th Avenue Northeast in Seattle,Washington.

At the auction, Douglas and Cheryl J. Laukkonen offered to pay$1,300,000 for the Seattle Property. The Debtors determined thatthe Laukkonens had the best and highest offer for the SeattleProperty.

The Honorable Jerry Venters of the U.S. Bankruptcy Court for theWestern District of Missouri authorized the Debtors to sell theirinterest in the Seattle Property to the Laukkonens for$1,300,000.

INTERSTATE BAKERIES: O'Melveny Approved as Special Labor Counsel----------------------------------------------------------------The Honorable Jerry Venters of the U.S. Bankruptcy Court for theWestern District of Missouri authorized Interstate BakeriesCorporation and its debtor-affiliates to employ O'Melveny & MyersLLP as their special labor counsel, nunc pro tunc to Oct. 12,2006.

As reported in the Troubled Company Reporter on Nov. 13, 2006,O'Melveny will:

(a) provide general labor advice and services;

(b) advise the Debtors regarding the treatment of labor agreements under the Bankruptcy Code and the National Labor Relations Act; and

(c) provide other necessary advice and services as the Debtors may require in connection with their cases.

The Debtors will pay O'Melveny its customary hourly rates. Theattorneys that are expected to be principally responsible forcertain matters in the Debtors' Chapter 11 cases are:

Tom Jerman, Esq., a partner at O'Melveny & Myers LLP in NewYork, assured the Court that the firm does not represent anyinterest adverse to the Debtors and their estates, and isdisinterested pursuant to Section 101(14) of the Bankruptcy Code.

ITRON INC: Buys Flow Metrix in Cash-for-Stock Merger for $15 Mil.-----------------------------------------------------------------Itron Inc. entered into an agreement to acquire all of theoutstanding capital stock of Flow Metrix Inc. for an initialpurchase price of $15 million in a cash-for-stock merger.

The Company disclosed that the initial purchase price of$15 million will be paid in cash, subject to a working capitaladjustment and certain escrow provisions. An additional paymentof up to $3 million may be made if certain technological andintegration milestones are achieved within the first 36 months.Additionally, the agreement provides the Company a one-year optionto purchase additional technology targeted at energy pipelineintegrity for a specified price.

As reported in the Troubled Company Reporter on Oct. 27, 2006,Moody's Investors Service confirmed Itron Inc.'s Ba3 CorporateFamily Rating in connection with the rating agency'simplementation of its new Probability-of-Default and Loss-Given-Default rating methodology.

KANSAS CITY SOUTHERN: Earns $31.3 Million in 2006 Third Quarter---------------------------------------------------------------Kansas City Southern Railway reported a $31.3 million net incomeon $415.7 million of revenues for the third quarter endedSept. 30, 2006, compared with a $112.7 million net income on$384.6 million of revenues for the same period in 2005.

Consolidated net income for the third quarter of 2006 decreased$81.4 million primarily due to a one-time, non-cash gain of$131.9 million as a result of a VAT claim and put settlement withthe Mexican Government recorded in the third quarter of 2005.This settlement resulted in the company attaining 100% ownershipof Grupo KCSM, S.A. de C.V. The company also recorded, based onan actuarial study, an expense of $37.8 million for personalinjury liabilities in the third quarter. These items have a$14.5 million tax benefit.

Revenue growth for the third quarter of 2006 was due to a 1.9%increase in volumes, and a continued recognition of the value ofthe company's freight services. Consolidated operating expensesdecreased reflecting reductions in all cost categories except fueland compensation and benefits inflation.

Kansas City Southern is a Delaware holding company with principaloperations in rail transportation. The company owns and operatesdomestic and rail operations in North America that arestrategically focused on the growing north/south freight corridorconnecting key commercial and industrial markets in the centralU.S. with major industrial cities in Mexico.

The company's rail network extends from the Midwest andSoutheastern portions of the U.S. south into Mexico and connectswith all other Class I railroads providing shippers with aneffective alternative to other railroad routes and giving directaccess to Mexico and the southeastern and southwestern U.S.through less congested interchange hubs.

The company also owns 50% of the stock of the Panama Canal RailwayCompany, which holds the concession to operate a 47-mile coast-to-coast railroad located adjacent to the Panama Canal. The railroadhandles containers in freight service across the isthmus. PanarailTourism Company, Panama Canal Railway's wholly owned subsidiary,operates commuter and tourist railway services over the lines ofthe Panama Canal Railway.

* * *

As reported in the Troubled Company Reporter on Sept. 6, 2006,Standard & Poor's Ratings Services affirmed its ratings, includingthe 'B' corporate credit rating on Kansas City Southern andremoved the rating from CreditWatch. The outlook is negative.

KING PHARMACEUTICALS: Earns $90.4 Million in 2006 Third Quarter---------------------------------------------------------------King Pharmaceuticals, Inc. reported a $90.4 million net income on$491.7 million of revenues for the third quarter ended Sept. 30,2006, compared with a $121.8 million net income on $518 million ofrevenues for the same period in 2005.

Gross sales were lower in the third quarter of 2006 due to anincrease in wholesale inventory levels of certain brandedpharmaceutical products in the third quarter of 2005 whichbenefited gross sales during that quarter. Additionally, thelower levels of gross sales during the third quarter was also dueto a decline in prescriptions of certain of the company's brandedpharmaceutical products since the third quarter of 2005, partiallyoffset by the effect of price increases taken during the fourthquarter of 2005.

Total operating costs and expenses increased $37.8 million,primarily due to a $39.4 million increase in research anddevelopment costs, a $14.2 million increase in cost of revenues, a$2.6 million increase in restructuring charges, and a $6.5 millionincrease in depreciation and amortization expenses, offset by a$24.9 million decrease in selling, general and administrativeexpenses.

The increase in research and development costs is due primarily tothe company's acquisition of in-process research and developmentcosts associated with the company's collaboration with ArrowInternational Limited and certain of its affiliates, tocommercialize novel formulations of ramipril, the activeingredient in the company's Altace(R) product.

Cost of revenues increased in the third quarter of 2006 due mainlyto the increase in cost of revenue from branded pharmaceuticalproducts compared to the third quarter of 2005. This increase isprimarily due to additional royalties the company began paying onSkelaxin(R) on Jan. 1, 2006. Depreciation and amortizationexpense increased due to reductions in estimated useful lives ofcertain assets.

On Sept. 6, 2006, the Company entered into a definitive assetpurchase agreement and related agreements with LigandPharmaceuticals Incorporated to acquire rights to Ligand'sAvinza(R). Avinza(R) is an extended release formulation ofmorphine and is indicated as a once-daily treatment for moderate-to-severe pain in patients who require continuous, around-the-clock opioid therapy for an extended period of time. The Companyanticipates that the transaction will close on or about December31, 2006.

As reported in the Troubled Company Reporter on Sept. 26, 2006,Moody's Investors Service confirmed its Ba3 Corporate FamilyRating for King Pharmaceuticals, Inc. and its Baa3 rating on thecompany's $400 million issue of secured revolving credit facility,in connection with the implementation of its new Probability-of-Default and Loss-Given-Default rating methodology for the U.S.pharmaceutical sector. Additionally, Moody's assigned an LGD2rating to those bonds, suggesting noteholders will experience a12% loss in the event of a default.

Laidlaw reported a $124.9 million net income on $3.1 billion ofrevenues for the fiscal year ended Aug. 31, 2006, compared with a$212.4 million net income on $3 billion of revenues in 2005.

Revenues increased $105.4 million in the fiscal year ended Aug.31, 2006, compared with fiscal year 2005, mainly due to increasesin revenues from the Education services and the Greyhound businesssegments of $61.3 million and $42.6 million, respectively.

The revenue increase in the Greyhound segment was primarily due tohigher ticket prices and a favorable Canadian dollar exchange ratesomewhat offset by passenger reductions due to both networkchanges and increased ticket prices. Additionally, revenue in2006 benefited from increased passenger volume in regions of theU.S. with high instances of individuals dislocated by the severehurricanes that occurred in the Gulf Coast.

Laidlaw also incurred lower interest expenses of $24.3 million infiscal 2006, compared with $70.8 million fiscal 2005, due tochanges made to the Company's debt structure during the fourthquarter of fiscal 2005 that reduced the amount of outstanding debtand lowered interest rates.

Notwithstanding, the Company reported a lower net income of $124.9million in fiscal 2006, compared to a net income of $212.4 millionin fiscal 2005, due to a $218 million income from discontinuedoperations recognized in fiscal 2005, compared to a $12.6 millionloss from discontinued operations in fiscal 2006.

This gain was due to the completion of the sale of the company'stransportation services and emergency management services businesssegments to an affiliate of Onex Corp. in fiscal 2005, while theadditional loss from discontinued operations in fiscal 2006primarily relates to the understatement in the sold businesssegments' accounts receivable reserves related to contingentobligations of the sold businesses that are partially indemnifiedby the company under the stock purchase agreement.

In July 2006, the Company amended its existing senior securedcredit facilities to consist of a $277.5 million term loan dueJune 2010, a $300 million revolving credit facility and add a$500 million term loan due July 2013.

Principal on the $277.5 million term loan facility is payable inquarterly installments of:

* $7.5 million from Sept. 30, 2006 through June 30, 2007;

* $11.25 million from Sept. 30, 2007 through June 30, 2009;

* $37.5 million from Sept. 30, 2009 through March 31, 2010; and

* a final payment of $45.0 million due on June 30, 2010.

The $500 million term loan facility consists of:

* a $375 million loan to Laidlaw International, Inc., and

* a $125 loan to its Canadian subsidiaries.

Principal is payable in 26 quarterly installments of $1.25 millionfrom Dec. 31, 2006 through Mar. 31, 2013 and a final payment of$467.5 million is due on July 31, 2013.

The $300 million Revolver was established to fund the company'sworking capital and letter of credit needs. It has a $200 millionsub-limit for letters of credit, a $15 million sub-limit forswingline loans and a $50 million sub-limit for Canadian dollarborrowings and Canadian dollar letters of credit by Canadianborrowers. On Aug. 31, 2006, there were $22.0 million of cashborrowings and there were issued letters of credit of $118.6million, leaving $159.4 million of availability. The $22.0million cash borrowings are classified as long term based on theCompany's intent and ability under the terms of the Revolver.

The Credit Facilities are guaranteed by the Company's wholly-ownedU.S. and Canadian subsidiaries excluding the Company's insurancesubsidiaries. However, the Canadian subsidiaries' guarantees andcollateral only support the loans made to the Canadian borrowers.

About Laidlaw International

Headquartered in Arlington, Texas, Laidlaw International, Inc.(NYSE:LI) -- http://www.laidlaw.com/-- is the largest school bus operator in the United States and Canada, providing studenttransportation services to more than a thousand school districts,operating a fleet of approximately 41,000 buses. The companytransports approximately two million students each school day toand from school. Laidlaw filed for chapter 11 protection on June28, 2001 (Bankr. W.D.N.Y. Case No. 01-14099). Garry M. Graber,Esq., at Hodgson Russ LLP, represented the Debtors. LaidlawInternational emerged from bankruptcy on June 23, 2003.

* * *

As reported in the Troubled Company Reporter on July 11, 2006,Moody's Investors Service affirmed Laidlaw International Inc.'scorporate family rating at Ba2 following the Company'sannouncement of a $500 million debt-financed share repurchaseprogram. Moody's also assigned a Ba2 rating to the Company's newsenior secured term loan. The rating outlook is stable.

LEVITZ HOME: Committee Hires LeClair Ryan as Litigation Counsel---------------------------------------------------------------The Official Committee of Unsecured Creditors appointed in LevitzHome Furnishings, Inc., and its debtor-affiliates' bankruptcy caseobtained authority from the U.S. Bankruptcy Court for the SouthernDistrict of New York to retain the law firm of LeClair Ryan as itsspecial litigation counsel, nunc pro tunc to Aug. 15, 2006.

As special litigation counsel, LeClair will:

(i) provide analysis to the Creditors' Committee regarding potential recovery of avoidance actions and any defenses to those actions;

(ii) make demands, file appropriate complaints or other pleadings in an effort to recover avoidable transfers;

(iii) to the extent appropriate, negotiate settlements with third-party defendants in the avoidance actions on behalf of the Creditors' Committee;

(iv) provide the Creditors Committee with legal advice concerning the advisability of litigating or settling each of the avoidance actions;

(v) provide regular reporting, and accounting, of the status of all preferences and other avoidance actions; and

(vi) perform other legal services for the Creditors' Committee as may be necessary or proper.

With respect to each avoidance claim for which LeClair isengaged, LeClair will be paid on a contingency fee basis:

(1) Category I Cases

LeClair will be paid 10% of the gross recovery for any Category I Case. A "Category I Case" will mean any avoidance claim handled by LeClair that settles after written demand letters are issued, but before a complaint is filed with respect to that claim;

(2) Category II Cases

LeClair will be paid 15% of the gross recovery for any Category II Case. A "Category II Case" will mean any avoidance claim handled by LeClair that settles at anytime after the complaint is filed in respect to the matter and that is not a Category III Case;

(3) Category III Cases

LeClair will be paid 20% of gross recovery for any Category III Case. A "Category III Case" will mean any avoidance claim handled by LeClair that goes to trial or settles within five business days before any trial or arbitration or anytime thereafter.

The Troubled Company Reporter disclosed on Sept. 20, 2006, thatLeClair will generate monthly statements showing the gross amountsrecovered during the previous month, the Category of the recovery,and a calculation of the appropriate fee to be paid to LeClair forthe recovery.

In addition to legal fees, LeClair's monthly statements will setforth expenses incurred and costs advanced on the Creditors'Committee's behalf. LeClair will not seek reimbursement fortravel expenses between its offices outside of New York and NewYork in connection with the engagement.

LeClair will be permitted, on a monthly basis, to receive fromthe gross recoveries on the avoidance actions, its percentagefee, as applicable, plus 100% of its expenses, up to a cap of$50,000. After the $50,000 cap on expenses is exceeded byLeClair, it will be permitted to receive 80% of its qualifiedexpenses on a monthly basis from the gross recovery on theavoidance actions.

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.-- http://www.levitz.com/-- retails furniture in the United States with 121 locations in major metropolitan areas principallythe Northeast and on the West Coast of the United States. TheCompany and its 12 affiliates filed for chapter 11 protection onOct. 11, 2005 (Bank. S.D.N.Y. Lead Case No. 05-45189). David G.Heiman, Esq., and Richard Engman, Esq., at Jones Day, representthe Debtors in their restructuring efforts. When the Debtorsfiled for protection from their creditors, they reported$245 million in assets and $456 million in debts. Jay R. Indyke,Esq., at Kronish Lieb Weiner & Hellman LLP represents the OfficialCommittee of Unsecured Creditors. Levitz sold substantially allof its assets to Prentice Capital on Dec. 19, 2005. (LevitzBankruptcy News, Issue No. 22; Bankruptcy Creditors' Service,Inc., http://bankrupt.com/newsstand/or 215/945-7000)

LEVITZ HOME: Court Okays Gazes LLC as Panel's Special Counsel-------------------------------------------------------------The U.S. Bankruptcy Court for the Southern District of New Yorkhas authorized The Official Committee of Unsecured Creditors ofLevitz Home Furnishings, Inc., and its debtor-affiliates to retainGazes LLC, as its special litigation counsel.

Gazes will investigate and potentially pursue actions against theDebtors' officers and directors for breach of fiduciary duty.

As reported in the Troubled Company Reporter on Oct. 16, 2006, theCommittee has been made aware of two civil actions currentlypending in the U.S. District Court for the Southern District ofNew York:

Creditors Committee Chairperson Richard E. Caruso said Gazes willbe responsible for both investigating and pursuing any action tobe brought against the Debtors' officers and directors on behalfof the Debtors' estates, at the behest of the Creditors Committee.

As special counsel, Gazes will:

(a) review and analyze the legal and factual bases of the Actions;

(b) analyze whether the pursuit of similar actions by the Creditors Committee would be likely to add value to the Debtors' estate and the GUC Trust; and

(c) manage any actions brought by the Creditors Committee against the Debtors' officers and directors to resolution, whether through judgment after trial, settlement, or dismissal.

Gazes will be compensated on a contingent fee basis in an amountrepresenting 30% of the gross amounts realized through judgment,settlement or other disposition of any actions commenced by thefirm on behalf of the Creditors Committee.

Furthermore, Gazes will be permitted, upon Court approval, toreceive from the gross recoveries of any actions commenced byGazes on behalf of the Creditors Committee its percentage fee, asapplicable, plus 100% of its expenses.

Headquartered in Woodbury, New York, Levitz Home Furnishings, Inc.-- http://www.levitz.com/-- retails furniture in the United States with 121 locations in major metropolitan areas principallythe Northeast and on the West Coast of the United States. TheCompany and its 12 affiliates filed for chapter 11 protection onOct. 11, 2005 (Bank. S.D.N.Y. Lead Case No. 05-45189). David G.Heiman, Esq., and Richard Engman, Esq., at Jones Day, representthe Debtors in their restructuring efforts. When the Debtorsfiled for protection from their creditors, they reported$245 million in assets and $456 million in debts. Jay R. Indyke,Esq., at Kronish Lieb Weiner & Hellman LLP represents the OfficialCommittee of Unsecured Creditors. Levitz sold substantially allof its assets to Prentice Capital on Dec. 19, 2005. (LevitzBankruptcy News, Issue No. 22; Bankruptcy Creditors' Service,Inc., http://bankrupt.com/newsstand/or 215/945-7000)

LODGENET ENT: Sept. 30 Balance Sheet Upside-Down by $62.4 Million-----------------------------------------------------------------Lodgenet Entertainment Corp. reported a $2.2 million net income on$76.5 million of revenues for the third quarter ended Sept. 30,2006, compared with a $585,000 net income on $74.1 million ofrevenues for the same period in 2005.

During the third quarter of 2006, total revenue increased 3.2%, or$2.4 million, compared to the third quarter of 2005. The growthwas driven in part by the company's expanding digital room base,and in part by a 2.8% increase in revenue per average Guest Payroom. Total direct costs were $36.0 million, an increase of $1.6million as compared to $34.4 million in the third quarter of 2005.Total operating expenses were $32.07 million as compared to $32.09million in the third quarter of 2005. As a result, operatingincome increased 9.4% to $8.4 million in the third quarter of 2006compared to $7.7 million in the third quarter of 2005.

In the third quarter of 2006, the Company recorded $234,000 ofinterest income, compared to $192,000 of interest income and$62,000 of other income in the third quarter of 2005.

At Sept. 30, 2006, the Company's balance sheet showed $268.9million in total assets and $331.3 million in total liabilities,resulting in a $62.4 million stockholders' deficit.

Liquidity and Capital Resources

For the third quarter of 2006, cash provided by operatingactivities was $23.8 million while cash used for investingactivities, including growth-related capital investments, was$11.7 million, resulting in a net difference of $12.1 million.During the third quarter of 2005, cash provided by operatingactivities was $19.0 million while cash used for investingactivities, including growth-related capital investments, was$11.2 million, resulting in a net change of $7.8 million. Cash asof Sept. 30, 2006 was $31.1 million.

Full-text copies of the company's consolidated financialstatements are available for free at:

LodgeNet Entertainment Corporation (Nasdaq:LNET) -- http://www.lodgenet.com/ --provides cable, video-on-demand and video game entertainment services to the lodging industry.LodgeNet maintains its headquarters in Sioux Falls, South Dakota.As of Sept. 30, 2006, the company provided interactive and basiccable television services to approximately 6,100 hotel propertiesserving over one million rooms.

* * *

As reported in the Troubled Company Reporter on Nov. 2, 2006,Moody's affirmed the 'B1' rating for both the Corporate FamilyRating and Probability of Default Rating of LodgenetEntertainment, the 'Ba1' rating for both the company's SeniorSecured Revolver and Senior Secured Term Loan, and the 'B2' ratingfor the company's 9.5% Senior Sub Notes. Outlook is Positive.

Medirect Latino reported a net loss of $24.6 million on$6.7 million of sales for the fiscal year ended June 30, 2006,compared with a $2.6 million net loss on $279,000 of sales infiscal 2005.

At June 30, 2006, the company's balance sheet showed $2.9 millionin total assets and $3.2 million in total liabilities, resultingin a $316,000 stockholders' deficit. Additionally, accumulateddeficit stood at $28.6 million as of June 30, 2006.

The company's balance sheet also showed strained liquidity with$2.5 million in total current assets available to pay $3.2 millionin total current liabilities.

Sales increased in fiscal 2006 mainly as a result of thecommencement of the company's direct response national marketingcampaign on Telemundo Television Network on Sept. 20, 2005. 100%of the sales for fiscal 2006 were derived from patients covered bymedicare and other party payers.

Operating expenses grew to $29.9 million in fiscal 2006 comparedto $2.7 m in fiscal 2005, which accounts for the substantial netloss of $24.6 million in fiscal 2006 compared to the net loss of$2.6 million in fiscal 2005. The bulk of this increase came fromincreases in selling, general and administrative expenses, mainlysalaries and wages of administrative and sales personnel, as wellas the costs attributable to stock based compensation.

The company incurred interest and financing costs for fiscal 2006of $1.4 million compared to $1 million in fiscal 2005.

Full-text copies of the company's consolidated financialstatements are available for free at:

Approximately 100% of the company's diabetes patients are coveredby Medicare or other party payers. As a result, changes to theMedicare program can impact the company's revenues and income.

These regulatory changes can affect also permissible activities,the relative costs associated with doing business, andreimbursement amounts paid by federal, state and other third-partypayers. At present, Medicare reimburses at 80% of the government-determined fee schedule amounts for reimbursable supplies, and thecompany bills the remaining balance either to third-party payersor directly to patients.

About Medirect Latino

Headquartered in Pompano Beach, Florida, Medirect Latino, Inc. -- http://www.medirectlatino.org./is an early stage company. It is a federally licensed, direct-to-consumer, participating providerof Medicare Part B Benefits primarily focused on supplyingdiabetic testing supplies to the Hispanic Medicare-eligiblecommunity domestically and in Puerto Rico. The company alsodistributes 'quality of life' enhancing products like walkingassistance devices, to customers who have circulatory and mobilityrelated afflictions resulting from diabetes. The company alsomaintains offices in San Juan, Puerto Rico.

The company was formerly known as Interaxx Digital Tools, Inc.,one of four stand alone companies resulting from a second jointplan of reorganization filed under Chapter 11 of the bankruptcycode. The reorganization was treated as a reverse merger andsubsequently, Interaxx Digital changed its name to MedirectLatino, Inc. as the new operating entity.

MIDPOINT DEVELOPMENT: Dissolved LLC Couldn't File for Bankruptcy----------------------------------------------------------------The United States Court of Appeals for the Tenth Circuit says thata chapter 11 filing by Midpoint Development, L.L.C. (Bankr. W.D.Okla. Case No. 04-16795), was a nullity and the case was properlydismissed. Claudia S. Holliman and Gary West, as the Trustees ofthe 1990 Grieser Trust, filed a joint motion to dismiss Midpoint'sChapter 11 petition, asserting that the debtor, a dissolvedOklahoma limited liability company, was ineligible to be a debtorunder the Bankruptcy Code. The United States Bankruptcy Court forthe Western District of Oklahoma, Richard L. Bohanon, J., 313 B.R.486, denied the motion, and the creditors appealed. The DistrictCourt reversed and dismissed the petition. The Debtor appealedand filed motion to certify the question on appeal to the OklahomaSupreme Court.

In a decision published at 466 F.3d 1201, the Tenth Circuit holds(1) under Oklahoma law, an LLC ceases to exist as a legal entityupon the effective date of its articles of dissolution; (2)because the debtor did not file for bankruptcy until more thanseven months after filing its articles of dissolution, itsbankruptcy filing was a nullity and subject to dismissal; and (3)certification to the Oklahoma Supreme Court was not merited.

MUSICLAND HOLDING: Michigan Dept. Wants Plan Confirmation Denied----------------------------------------------------------------The Michigan Department of Treasury asks the U.S. Bankruptcy Courtfor the Southern District of New York to deny the confirmation ofMusicland Holding Corp. and its debtor-affiliates' Second AmendedPlan of Liquidation.

The business activities of the Debtors have resulted inliabilities to the state of Michigan for sales, use and singlebusiness taxes, Michael A. Cox, Attorney General for the state ofMichigan, relates.

The Debtors have, however, failed to file a notice ofdiscontinuance and tax returns for sales and use tax for April2006 through November 2006, Mr. Cox tells the Court. The Debtorsalso failed to remit taxes, penalties and interest due for thesame period, Mr. Cox adds.

Mr. Cox contends that the Debtors' failure to file postpetitiontax returns and quarterly estimates and their failure to payadministrative tax liabilities constitute violations of Section960 of the Judiciary and Judicial Procedures Code. "The Debtors'disregard of Section 960 raises a doubt as to whether theDebtors' proposed plan is offered in good faith as required bySection 1129(a)(3) of the Bankruptcy Code," Mr. Cox says.

The existence of administrative tax liabilities in unknownamounts, Mr. Cox points out, prevents the Court from determiningwhether the Debtors' Plan can meet the requirements of Section1129(a)(9)(A) and (C).

The Plan proposes that priority tax claims accrue a "simpleinterest on any outstanding balance from the Effective Datecalculated at the interest rate available on 90 days United StatesTreasuries on the Effective Date, but in no event greater than7.0% per annum."

Mr. Cox argues that the interest required by Section1129(a)(9)(C) must be in accordance with Section 511 of theBankruptcy Code, which states, "the rate of interest will be therate determined under applicable non-bankruptcy law." Treasurycurrent interest rate for bankruptcy tax claims is 8.2%, Mr. Coxinforms the Court.

Moreover, the Michigan Treasury Department objects to any attemptof the Plan to discharge the debts of the Debtors or theReorganized Debtors. Section 1141(d)(3) of the Bankruptcy Codeprohibits the discharge of a debtor that liquidates or ceasesbusiness operations, Mr. Cox maintains.

Headquartered in New York, New York, Musicland Holding Corp., is aspecialty retailer of music, movies and entertainment-relatedproducts. The Debtor and 14 of its affiliates filed for chapter11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,represents the Debtors in their restructuring efforts. Mark T.Power, Esq., at Hahn & Hessen LLP, represents the OfficialCommittee of Unsecured Creditors. When the Debtors filed forprotection from their creditors, they estimated more than $100million in assets and debts. (Musicland Bankruptcy News, IssueNo. 23; Bankruptcy Creditors' Service, Inc.,http://bankrupt.com/newsstand/or 215/945-7000)

MUSICLAND HOLDING: Mass. Revenue Objects to Plan Confirmation-------------------------------------------------------------Stephen G. Murphy, Esq., counsel to the Commissioner of theMassachusetts Department of Revenue, asserts that the Debtors'Second Amended Plan of Liquidation fails to comply with numerousprovisions of the Bankruptcy Code.

Section 1129(a)(9)(C) of the Bankruptcy Code requires that a planmust provide that the holder of a priority tax claim will receiveregular installment payments of cash "of a total value, as of theEffective Date, equal to the allowed amount of the claim" withinfive years of the petition date."

Section 511 of the Bankruptcy Code provides that the rate ofinterest will be the rate determined under applicable non-bankruptcy law if payment of interest on a tax claim or payment ofinterest to enable a creditor to receive the present value of theallowed amount of a tax claim is required. In the case of taxespaid under a confirmed plan, the rate of interest will bedetermined as of the calendar month when the plan is confirmed.

Thus, Mr. Murphy contends, Section 511, and not the Plan, shouldgovern the rate of interest that must accrue on the deferredpayments of priority tax claims.

"Assuming confirmation occurs prior to Dec. 31, 2006, the rate ofinterest on the priority tax claims held by [MDOR] underapplicable non-bankruptcy law will be 9% compounded daily," Mr.Murphy notes.

The Plan is a liquidation plan and not a plan for thereorganization of a continuing business. Thus, Section 1141(d)(3)of the Bankruptcy Code prohibits the Debtors from obtaining adischarge. While the Plan does not purport to grant the Debtors adischarge, it does attempt to provide persons associated with theDebtors relief that a discharge cannot grant and that is onlyrarely permitted for persons associated with a reorganizedbusiness, Mr. Murphy points out.

Moreover, the Plan specifically singles out and impairs a specialcategory of creditors -- the holders of priority tax claims, Mr.Murphy emphasizes. "It impairs the rights of the holders ofpriority tax claims by preventing actions the taxing authorities,and in particular, MDOR, may lawfully undertake."

Accordingly, the MDOR asks the Court to sustain its objection anddeny confirmation of the Plan.

Headquartered in New York, New York, Musicland Holding Corp., is aspecialty retailer of music, movies and entertainment-relatedproducts. The Debtor and 14 of its affiliates filed for chapter11 protection on Jan. 12, 2006 (Bankr. S.D.N.Y. Lead Case No.06-10064). James H.M. Sprayregen, Esq., at Kirkland & Ellis,represents the Debtors in their restructuring efforts. Mark T.Power, Esq., at Hahn & Hessen LLP, represents the OfficialCommittee of Unsecured Creditors. When the Debtors filed forprotection from their creditors, they estimated more than $100million in assets and debts. (Musicland Bankruptcy News, IssueNo. 23; Bankruptcy Creditors' Service, Inc.,http://bankrupt.com/newsstand/or 215/945-7000)

MYLAN LABORATORIES: Net Income Rose 117% in Third Quarter 2006--------------------------------------------------------------In its third quarter financial statements for the quarterly periodended Sept. 30, 2006, Mylan Laboratories, Inc. reported$77.5 million of net income on $366.7 million of total revenuesfor the three month period ended Sept. 30, 2006.

Comparatively, for the three months ended Sept. 30, 2005, thecompany earned $35.8 million net income on total revenues of $298million. This represents an increase of 23% in total revenues and117% in net earnings when compared to the same prior year period.

The increase in revenue was driven by both increased volume andstable pricing. During the quarter Fentanyl(R) continued to bethe only AB-rated generic alternative to Duragesic(R) on themarket and accounted for approximately 20% of net sales. As aresult of a continued shift from brand to generic, Fentanyl(R)contributed favorably to both pricing and volume.

Other revenue for the quarter ended Sept. 30, 2006, consistedprimarily of amounts recognized with respect to Apokyn(R), whichwas sold in the prior year, with the remainder related to otherbusiness development activities.

Consolidated gross profit increased 37% or $52.9 million to $196.1million and gross margins increased to 53.5% from 48.1%. Asignificant portion of gross profit was generated by Fentanyl(R)sales which contribute margins well in excess of most otherproducts in our portfolio. Absent any changes to market dynamicsor significant new competition for Fentanyl(R), the companyexpects the product to continue to be a significant contributor tosales and gross profit. As is the case in the generic industry,the entrance into the market of other generic competitiongenerally has a negative impact on the volume and pricing of theaffected products.

At Sept. 30, 2006, the company's balance sheet showed $2,035million in total assets, $1,079 million in total liabilities, and$956 million in stockholders' equity.

Working capital as of Sept. 30, 2006, was $1.1 billion compared to$926.7 million at March 31, 2006. This increase is primarily theresult of increased receivables, due to the timing of cashcollections and shipments, an increase in inventory due toaligning production to forecasted volumes, and an increase inmarketable securities.

A full-text copy of the company's financial statements for thequarterly period ended Sept. 30, 2006, are available for free at

Headquartered in Canonsburg, Pennsylvania, Mylan Laboratories Inc.is a pharmaceutical company with three principal subsidiaries:Mylan Pharmaceuticals Inc., Mylan Technologies Inc., and UDLLaboratories, Inc. During the fiscal year ended March 31, 2006,Mylan reported total revenue of approximately $1.26 billion.

* * *

As reported in the Troubled Company Reporter on Sept. 26, 2006,Moody's Investors Service confirmed Mylan Laboratories, Inc.'s Ba1Corporate Family Rating in connection with the implementation ofits Probability-of-Default and Loss-Given-Default ratingmethodology for the U.S. Pharmaceutical sector.

OM GROUP: Selling Nickel Assets to Norilsk for $408 Million-----------------------------------------------------------OM Group, Inc. has entered into a definitive agreement to sell allof its nickel assets to Norilsk Nickel for $408 million in cash,on a debt-free/cash-free basis, plus a potential post closingadjustment for net working capital. The transaction, which hasbeen unanimously approved by the Board of Directors of bothcompanies, is subject to approval by regulatory authorities aswell as other customary closing conditions.

The sale is in line with OM Group's previously stated businessobjective to monetize its nickel business, which management hasconcluded is a non-core asset. The company expects to use theproceeds of the transaction to improve its financial flexibilityand strengthen its position to grow operations, including throughpotential strategic acquisitions and increased new productdevelopment.

"This transaction represents an important step in our effort tore-tool OM Group's business model into one that delivers morepredictable and sustainable financial results, and betterpositions us to continue to build long-term value for ourshareholders," said Joe Scaminace, chairman and chief executiveofficer. "Through this transaction, we would simultaneouslyachieve three mission-critical objectives in our strategictransformation into a diversified specialty chemicals and advancedmaterials company. Those objectives are to focus the company onits strengths in developing and producing value-added specialtyproducts for customers that serve dynamic markets; to lessen theimpact of metal price volatility on our bottom line; and tosupport our aggressive growth plans."

The company believes that the timing for such a transaction isideal given historically high nickel prices. "While our intentwas not to try to time the market, we believe this is an idealtime in the base metals cycle to exit the nickel business. In ourestimation, the current value of the business is greater than itsfuture value as it's a capital intensive business for us where wehave faced raw material feed constraints and significant pricevolatility," Mr. Scaminace said. "More important, we believe wehave found a unique buyer for this business - one that is well-positioned to create a broader working relationship with us."

Given the complementary geography and operations, OM Groupbelieves there are unique synergies between the two companies thatcould be leveraged to advance their respective strategies, buildon their core competencies and unlock value for theirshareholders.

"At the conclusion of this transaction, OMG's Specialties segmentwill enter into five-year supply agreements with Norilsk's tradingsubsidiary that will, among other things, further strengthen oursupply chain and secure consistent raw materials for ourspecialties business," said Mr. Scaminace. "The supply agreementsinclude: up to 2,500 metric tons per year of cobalt metal, up to2,500 mt per year of crude cobalt hydroxide concentrate and up to1,500 mt per year of crude cobalt sulfate, along with variousnickel-based raw materials used in OMG's electronic chemicalsbusiness."

The transaction is expected to close in the first quarter of 2007.The nickel business will be classified as a discontinuedoperation, including reclassification of prior periods, in allfuture filings. OM Group remains committed to providing thehighest level of service to its nickel customers through thetransition period, and it expects the change to new ownership tobe seamless for employees and customers.

About MMC Norilsk Nickel

OJSC MMC Norilsk Nickel is a mining and metallurgical companybased in Russia. It is the world's largest producer of nickel andpalladium, as well as a major producer of platinum and copper.

AS reported in the Troubled Company Reporter on Nov. 23, 2006,Standard & Poor's Ratings Services revised its outlook on OM GroupInc. to positive from stable. Standard & Poor's also affirmedthe 'B+' corporate credit rating on this Cleveland, Ohio-basedcompany.

As reported in the Troubled Company Reporter on Nov. 22, 2006,Moody's Investors Service affirmed OM Group Inc.'s B2 corporatefamily rating and B3 rating on its $400 million notes due 2011,and moved the ratings outlook to under review for possibleupgrade. The change in outlook followed the report by the companythat it had signed an agreement with Norilsk Nickel regarding thesale of OMG's nickel business.

OWENS CORNING: Deadline to Remove Prepetition Actions Expires-------------------------------------------------------------The U.S. Bankruptcy Court for the District of Delaware had grantedOwens Corning and its debtor-affiliates an open-ended extension oftheir deadline to remove prepetition lawsuits and other actions tothe U.S. District Court for the District of Delaware until 30 daysafter the confirmation of a plan of reorganization.

Owens Corning had emerged from bankruptcy protection effectiveOct. 31, 2006. The Bankruptcy Court approved Owens Corning'sPlan of Reorganization on Sept. 26, 2006. The District Courtaffirmed the Bankruptcy Court's Confirmation Order on Sept. 28,2006.

ROCOR INTERNATIONAL: Payments to Alta Partially Avoidable---------------------------------------------------------Rocin Liquidation Estate, as the successor to Rocor International,Inc., sued Alta AH & L to recover $126,797.81 paid to Alta Withinthe 90-day period to the date Rocor filed for bankruptcyprotection. The transfers in question were payments made by thedebtor for the purpose of providing health benefits forindependent contractors engaged by the debtor to haul freight. Ina decision published at 2006 WL 2831037, Chief Bankruptcy JudgeT.M. Weaver says the payments are avoidable in part.

The money to pay the insurer was withheld from payments to theindependent contractors. The insurer contended that the debtorhad express fiduciary duties with respect to these funds underERISA and that the funds were held in constructive trust for theowner-operators' benefit. However, it was undisputed that theseowner-operators were independent contractors not entitled tobenefits under ERISA, and the insurer was unable to trace sumswithheld from the owner-operators' compensation and presented noevidence of any fraud on the debtor's part, as required to imposea constructive trust.

As reported in the Troubled Company Reporter on Nov. 10, 2006,Saint Vincent Catholic Medical Center transferred five outpatientfamily health centers, including St. Peter Claver Clinic, toKingsbrook following the closure of St. Mary's Hospital inBrooklyn. Peter Claver Clinic is located at 1061-1063 LibertyAvenue, in Brooklyn, New York.

Pursuant to a lease dated September 1, 1991, SVCMC, as successor-in-interest to St. Mary's, leases the real property on which thePeter Claver Clinic is located from BBC Realty. SVCMC has notassumed or rejected the Liberty Avenue Lease.

In 2005, SVCMC and Kingsbrook entered into an agreement grantingKingsbrook a revocable license to use the Clinic's premises forits operation until April 2006. SVCMC and Kingsbrook extended thelicense agreement's expiration date until August 2006, and afterthat, on a month-to-month basis.

Kingsbrook and BBC Realty then executed a letter agreement underwhich BBC Realty consented to Kingsbrook's use of the Premises andcertain amendments to the Liberty Avenue Lease with respect toKingsbrook's tenancy.

Andrew M. Troop, Esq., at Weil, Gotshal & Manges LLP, in NewYork, disclosed that under the Lease, SVCMC is obliged to pay$12,909 per month to BBC Realty as base rent, plus $5,300 forutilities and taxes. Pursuant to the License Agreement,Kingsbrook reimburses SVCMC on a monthly basis for rent and otherexpenses.

Mr. Troop related that SVCMC, Kingsbrook, and BBC Realtydetermined that SVCMC's assumption and assignment of the LibertyAvenue Lease to Kingsbrook is the most effective way ofsubstituting Kingsbrook for SVCMC as tenant of the Premises.

Accordingly, the parties agreed to enter into an assumption andassignment agreement, which provides for SVCMC's transfer of itsright, title, and interest as tenant in the Liberty Avenue Leaseto Kingsbrook. SVCMC will have no further obligations under theLease, other than to:

(1) pay prepetition rent due to BBC Realty for the period July 1 to 5, 2005, for $1,700;

(2) pay rent, if any, due to BBC Realty for the period July 6, 2005, through the Assignment Agreement's effective date; and

(3) remedy any outstanding violation for failure to file a completed facility inventory form that has been assessed against the Premises for $5,200 and other regulatory violations.

Kingsbrook will assume all Liberty Avenue Lease' obligations andwill pay rent reserved by the Lease from and after the date of theAssignment Agreement until the termination of the Lease.

Headquartered in New York, New York, Saint Vincents CatholicMedical Centers of New York -- http://www.svcmc.org/-- the largest Catholic healthcare providers in New York State, operatehospitals, health centers, nursing homes and a home health agency.The hospital group consists of seven hospitals located throughoutBrooklyn, Queens, Manhattan, and Staten Island, along with fournursing homes and a home health care agency. The Company and sixof its affiliates filed for chapter 11 protection on July 5, 2005(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). GaryRavert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &Emery, LLP, filed the Debtors' chapter 11 cases. On Sept. 12,2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP tookover representing the Debtors in their restructuring efforts.Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents theOfficial Committee of Unsecured Creditors.

SAINT VINCENTS: Inks Assignment Agreements with Caritas-------------------------------------------------------Saint Vincents Catholic Medical Centers of New York and certain ofits debtor-affiliates have entered into a stipulation, approved bythe U.S. Bankruptcy Court for the Southern District of New York,providing for the assignment of certain Provider Agreements toCaritas Health Care Planning, Inc.

St. Vincent's Hospital Manhattan, Mary Immaculate Hospital,Queens, and St. John's Queens Hospital render services to Medicarebeneficiaries and participate in a Medicare program administeredby the Centers for Medicare and Medicaid Services.

SV Manhattan participates in a Medicare program under a provideragreement -- the SV Manhattan Provider Agreement -- with theSecretary of the United States Department of Health and HumanServices, under provider number 33-0290.

MIH and St. John's jointly participate in a Medicare program -- the Covered Provider Agreement -- under a separate provideragreement with the HHS, under a cover provider number 33-0357 andrelated sub-provider numbers 33-S357 and 33-5846.

In line with the sale of the Queens Hospitals to Caritas HealthCare Planning, Inc., and to avoid any interruption in theMedicare reimbursement for services provided to patients at MIHand St. John's, Saint Vincent Catholic Medical Centers andCaritas agreed that SVCMC will assume and assign MIH and St.John's Covered Provider Agreement to Caritas in the event thatthe sale of the facilities is consummated pursuant to an assetpurchase agreement dated May 9, 2006. The Provider Agreement isassigned subject to all the applicable statutes and regulationsunder which it was originally issued, including the assessment ofoverpayments incurred by the previous owner and the requirementunder 42 U.S.C. Section 1395g(a) that current Medicare paymentsbe adjusted to account for prior overpayments.

The total amount of overpayments made to MIH and St. John's bythe CMS through the Medicare program, for which adjustments areor will be sought, is still undetermined. However, based on areview of periodic interim payments made to MIH and St. John'sfor 2005, CMS determined that the facilities received anoverpayment of $5,055,441 -- the 2005 PIP Lump Sum Adjustment.

CMS further determined that it owes:

(i) MIH and St. John's $255,536 from the December 31, 2001, final cost report settlement, and $2,396,003 from the December 31, 2002, final cost report;

(ii) SV Manhattan $437,975 from the December 31, 2001, final cost report settlement, and $615,582 from the December 31, 2002, final cost report settlement; and

(iii) St. Vincent's Staten Island Hospital $1,198,397 from the December 31, 2001, final cost report settlement.

In addition, the total amount of overpayments made to SV Manhattanby CMS through the Medicare program is still undetermined sinceaudits of the cost reports for the facility for years subsequentto 2002 are pending final settlement.

Accordingly, in a Court-approved stipulation, SVCMC, Caritas, theU.S. Government on behalf of HHS, and CMS agree that:

(1) SVCMC will assume the Provider Agreements under which SV Manhattan, and MIH and St. John's operate. Caritas will accept assignment of the Covered Provider Agreement;

(2) SVCMC will cure all defaults arising under the Provider Agreements:

* with respect to the SVCMC Manhattan Provider Number:

-- any overpayments which may be determined in the future in the ordinary course of business will be resolved on terms mutually acceptable to SVCMC and CMS including in accordance with any mutually acceptable extended repayment plan which may be negotiated between SVCMC and CMS;

* the 2005 PIP Lump Sum Adjustment:

-- has been and will continue to be reduced by equal monthly payments under a $225,000 extended repayment plan in accordance with an amortization schedule; and

-- has been further reduced by (a) the amount of the CMC 2001 and 2002 Final Settlements for $2,651,539, and (b) interest, which has been paid to date by SVCMC on the 2005 PIP Lump Sum Adjustment for $71,445. CMS will release to SVCMC the amounts owed under the Manhattan Final Settlement and the SVSI Final Settlement aggregating $2,251,954; and

* as to the Covered Provider Number:

-- any overpayments which may be determined by CMS and which accrued prior to the Closing Date will be collected on terms mutually acceptable to SVCMC and CMS including, without limitation, in accordance with any mutually acceptable extended repayment plan which may be negotiated between SVCMC and CMS, which Negotiated Plan will not be entered into by SVCMC without first obtaining Caritas' written consent.

(3) Caritas will have successor liability for any pre-closing overpayments, if and to the extent CMS is unable to recover overpayments in full from SVCMC. CMS will not seek to recover from Caritas any Pre-Closing Overpayments under the Covered Provider Agreement unless CMS notifies SVCMC of any default, and that default is not cured immediately. CMS will notify both SVCMC and Caritas of any Pre-Closing Overpayments made under the Covered Provider Number, which are determined after the closing date;

(4) if CMS is unable to fully recover any Pre-Closing Overpayments made under the Covered Provider Number from payments made to SVCMC under the SV Manhattan Provider Number, CMS will notify Caritas of the remaining amount owed and will let Caritas request an extended repayment plan before commencing recoupment of the remaining overpayment; and

(5) the provisions concerning Caritas' successor liability for any Medicare Pre-Closing Overpayments made under the Covered Provider Agreement is the only modification of Medicare's policies on successor liability.

Headquartered in New York, New York, Saint Vincents CatholicMedical Centers of New York -- http://www.svcmc.org/-- the largest Catholic healthcare providers in New York State, operatehospitals, health centers, nursing homes and a home health agency.The hospital group consists of seven hospitals located throughoutBrooklyn, Queens, Manhattan, and Staten Island, along with fournursing homes and a home health care agency. The Company and sixof its affiliates filed for chapter 11 protection on July 5, 2005(Bankr. S.D.N.Y. Case No. 05-14945 through 05-14951). GaryRavert, Esq., and Stephen B. Selbst, Esq., at McDermott Will &Emery, LLP, filed the Debtors' chapter 11 cases. On Sept. 12,2005, John J. Rapisardi, Esq., at Weil, Gotshal & Manges LLP tookover representing the Debtors in their restructuring efforts.Martin G. Bunin, Esq., at Thelen Reid & Priest LLP, represents theOfficial Committee of Unsecured Creditors.

SANTIAGO ASSOCIATES: Disclosure Statement Hearing Set for Nov. 30-----------------------------------------------------------------The Honorable Sarah S. Curley of the U.S. Bankruptcy Court for theDistrict of Arizona will convene a hearing at 10:00 a.m., onNov. 30, 2006, to consider the adequacy of the disclosurestatement explaining Santiago Associates Inc.'s Plan ofReorganization. The hearing will be held at the U.S. BankruptcyCourt, 230 North First Avenue, 7th Floor, Courtroom No. 701 inPhoenix, Arizona.

The Debtor's Plan is anchored on the sale of its real estateproperty located at 8015 and 8011 Santiago Canyon Road in OrangeCounty, California. The property, known as the Korbel Mansion,consists of a 22,000 square-foot guesthouse situated on 4.6 acresoverlooking the Cleveland National Forest. The Debtor hasreceived a $20 million offer for the property from Company of theStars and is seeking approval from the Court for the sale.

Treatment of Claims

First Credit Bank asserts a $10,072,871 claim against the Debtorand holds a first consentual lien on the Santiago Canyon propertyon account of the Debt. The Debtor intends to pay First Credit infull on the effective date of the Plan from proceeds of theproperty sale.

The Debtor's $289,000 debt to the Orange County CaliforniaTreasurer for property taxes will be paid from the proceeds of thesale of the Santiago Canyon property.

Compass Engineering holds a second consentual lien on the SantiagoCanyon property. It is owed approximately $1.58 million forconsulting services and for money loaned to the Debtor. Compasswill be paid in full on the effective date.

The Debtor owes Company of the Stars approximately $2 million forstock it purchased from the Company. Company of the Stars holds athird consensual lien on the Santiago Canyon property. The$2 million debt, plus any interest, will be paid in full on theeffective date.

Kerber Bros Inc.'s $22,500 claim and Southwest Companies Inc.'s$500,000 claim will be paid in full on the effective date. Kerberand Southwest hold Mechanics Lien on the Santiago Canyon propertyfor unpaid work they performed on the property.

Remaining proceeds from the Santiago Canyon property sale afterthe close of escrow and the payment of priority and secured claimswill be distributed to unsecured creditors in an amount necessaryto satisfy their claims in full.

Stockholders of the Debtor will get their pro rata share of theremaining sale proceeds after all creditors are paid in full.

Headquartered in Phoenix, Arizona, Santiago Associates, Inc.,filed for chapter 11 protection on May 18, 2006 (Bankr. D. Ariz.Case No. 06-01454). Lawrence d. Hirsch, Esq., at Hirsch LawOffice, P.C., represents the Debtor. No Official Committee ofUnsecured Creditors has been appointed in the Debtor's case. Whenthe Debtor filed for protection from its creditors, it estimatedassets and debts between $10 million and $50 million.

SEA CONTAINERS: Court Okays Young Conaway as Bankruptcy Counsel--------------------------------------------------------------- Sea Containers Ltd. and its debtor-affiliates obtained permissionfrom the U.S. Bankruptcy Court for the District of Delaware toemploy Young Conaway Stargatt & Taylor, LLP, as their counsel,nunc pro tunc to Oct. 15, 2006.

Young Conaway will:

(a) provide legal advice with respect to the Debtors' powers and duties as debtors-in-possession in their continued operation of their business and management of their properties;

(b) prepare and pursue confirmation of a plan and approval of a disclosure statement;

(d) appear in Court and protect the Debtors' interests before the Court; and

(e) perform all other legal services for the Debtors which may be necessary and proper in the Chapter 11 proceedings.

The Debtors will pay Young Conaway on an hourly basis, plusreimbursement of actual and necessary expenses and chargesincurred. The principal attorneys and paralegal personneldesignated to represent the Debtors and their current hourly ratesare:

The Debtors retained Young Conaway in September 2006 and theypaid the firm a $150,000 retainer in connection with the planningand preparation of initial documents, payment of Chapter 11filing fees, and the proposed postpetition representation of theDebtors.

Robert S. Brady, Esq., a partner at Young Conaway Stargatt &Taylor, LLP, assures the Court that his firm holds no interestadverse to the Debtors, their creditors or any other parties-in-interest, and it is a "disinterested person," as defined inSection 101(14) of the Bankruptcy Code.

About Sea Containers

Headquartered in Hamilton, Bermuda, Sea Containers Ltd. --http://www.seacontainers.com/-- provides passenger and freight transport and marine container leasing. Registered in Bermuda,the company has regional operating offices in London, Genoa, NewYork, Rio de Janeiro, Sydney, and Singapore. The company isowned almost entirely by United States shareholders and itsprimary listing is on the New York Stock Exchange (SCRA andSCRB) since 1974. On Oct. 3, the company's common shares andsenior notes were suspended from trading on the NYSE and NYSEArca after the company's failure to file its 2005 annual reporton Form 10-K and its quarterly reports on Form 10-Q during 2006with the U.S. Securities and Exchange Commission.

Through its GNER subsidiary, Sea Containers Passenger Transportoperates Britain's fastest railway, the Great North EasternRailway, linking England and Scotland. It also conducts ferryoperations, serving Finland and Estonia as well as a commuterservice between New York and New Jersey in the U.S.

SIRIUS SATELLITE: Sept. 30 Balance Sheet Upside-Down by $200.3MM----------------------------------------------------------------SIRIUS Satellite Radio Inc. incurred a $162.8 million net loss on$167.1 million of net revenues for the three months ended Sept.30, 2006, compared to a $180.4 million net loss on $66.8 millionof net revenues for the same period in 2005.

At Sept. 30, 2006, the company's balance sheet showed $1.6 billionin total assets and $1.8 billion in total liabilities, resultingin a $200.3 million stockholders' deficit.

The company's Sept. 30 balance sheet also showed strainedliquidity with $534.9 million in total current assets available topay $641.4 million in total current liabilities.

The company recorded total revenue increased 150% year-over-yearto $167.1 million for third quarter 2006, reflecting nearly threemillion new subscribers added in the last twelve months. Thecompany reported a 23% improvement in SAC per gross subscriberaddition from the year-ago quarter. Reflecting the company'simproving business model and rapidly growing subscriber base,SIRIUS' third quarter adjusted loss from operations decreased 21%year-over-year.

"SIRIUS continues to focus on excellence in programming and solidexecution of our business plan," said Mel Karmazin, CEO of SIRIUS."Over the last year, we generated $100 million in new revenue,increased our share of satellite radio net subscriber additions by24 percentage points and reduced our SAC per gross addition by23%. SIRIUS has never been in a stronger position heading intothe key fourth quarter holiday season, with exciting new products,compelling programming, and strong relationships with our retailand exclusive OEM partners. We are well prepared to meet fourthquarter demand and remain ocused on achieving positive free cashflow."

New York-based SIRIUS Satellite Radio Inc. (NASDAQ: SIRI) -- http://www.sirius.com/-- delivers more than 125 channels of the best programming in all of radio. SIRIUS is the original and onlyhome of 100% commercial free music channels in satellite radio,offering 67 music channels available nationwide. SIRIUS alsodelivers 61 channels of sports, news, talk, entertainment,traffic, weather and data. SIRIUS is the Official Satellite RadioPartner and broadcasts live play-by-play games of the NFL, NBA andNHL and. All SIRIUS programming is available for a monthlysubscription fee of only $12.95.

SIRIUS products for the car, truck, home, RV and boat areavailable in more than 25,000 retail locations, including BestBuy, Circuit City, Crutchfield, Costco, Target, Wal-Mart, Sam'sClub, RadioShack and at http://shop.sirius.com/

SOLUTIA INC: To File Amended Reorganization Plan on December 18---------------------------------------------------------------Solutia, Inc., and its debtor-affiliates intend to file an amendedplan of reorganization and disclosure statement premised on thesale of equity of the reorganized company on Dec. 18, 2006.

In a declaration filed with the Court, Jeffry N. Quinn, chairman,president and CEO of Solutia, disclosed that in September andOctober 2006, he met with a financial group that expressedinterest to sponsor an amended plan for Solutia. Early inNovember, Mr. Quinn met with potential investors interested inpurchasing equity in reorganized Solutia, including two majorchemical industry participants. On Nov. 13, management heldpresentations to the potential purchasers.

Mr. Quinn relates that Solutia's professionals continue toexplore all reasonable alternatives that would enable the Debtorsto emerge from bankruptcy as quickly and efficiently as possible.

Solutia has drafted a term sheet that outlines the amended plan'sterms. Under the revised plan, Solutia will sell 100% of newcommon stock to a purchaser. The sale would replace the proposedrights offering.

Cash distributions will be made to Solutia's creditors ratherthan a distribution of equity in the reorganized company, aspreviously contemplated in the original plan. Old equity will bewiped out.

A disputed claims reserve will be established on the Planeffective date that contains sufficient funding to satisfy theasserted secured portion of the Noteholders' claims in full inthe event they ultimately prevail in the adversary proceedingJPMorgan Chase Bank commenced in May 2005 against the Debtors,after the exhaustion of all trial proceedings and appeals.

Jonathan S. Henes, Esq., at Kirkland & Ellis LLP, in New York,advises that the Court has adjourned sine die the hearing toconsider approval of the Disclosure Statement explainingSolutia's original plan. The Disclosure Statement hearing wasinitially scheduled for Nov. 16, 2006.

If all things go as planned, Solutia will conduct an auction onFeb. 12, 2007, and a hearing to consider confirmation of theamended plan will be held on Feb. 26, 2006.

Solutia intends to emerge from bankruptcy on March 15, 2007.

Unlike the original plan, the revised Plan, Mr. Quinn says, wouldenable Solutia to emerge from Chapter 11 before an ultimatedetermination on the merits of the JPMorgan Adversary Proceedingand exhaustion of appeals.

Mr. Quinn notes that each of the significant constituencies inthe case, other than the Noteholders Committee, is willing tonegotiate and make concessions from the original plan, includingthe Trade Committee, Creditors Committee, Equity Committee,Monsanto and the potential investors.

Mr. Quinn also relates that Solutia recently completed a newbusiness plan that details how the company will continue toimprove its financial results. Solutia's financial advisors arerevising the business plan.

STEEL PARTS: Court Okays Pepper Hamilton as Bankruptcy Counsel--------------------------------------------------------------Steel Parts Corporation obtained permission from the United StatesBankruptcy Court for the Eastern District of Michigan to employPepper Hamilton LLP as its bankruptcy counsel.

Pepper Hamilton will:

a. provide legal advice with respect o the Debtor's powers and duties as a debtor-in-possession in the continued operation of its business and management of its assets;

b. assist the Debtor in maximizing the value of its assets for the benefit of all creditors and other parties in interest;

c. commence and prosecute any and all necessary and appropriate actions or proceedings on behalf of the Debtor and its assets;

d. prepare, on behalf of the Debtor, all of the applications, motions, answers, orders, reports and other legal papers necessary in the Debtor's bankruptcy proceeding;

e. appear in Court to represent and protect the interests of the Debtor and its estates; and

f. perform all other legal services for the Debtor that may be necessary and proper in its chapter 11 case.

The Debtor told the Court that the firm holds a $50,000 retainer.

Barbara Rom, Esq., a partner at Pepper Hamilton, assured the Courtthat her firm is "disinterested" as that term is defined inSection 101(14) of the Bankruptcy Code.

STEEL PARTS: Creditors Panel Hires O'Keefe as Financial Advisors----------------------------------------------------------------The Official Committee of Unsecured Creditors in Steel PartsCorporation's chapter 11 case obtained authority from the U.S.Bankruptcy Court for the Eastern District of Michigan to retainO'Keefe and Associates Consulting as its financial advisors, nuncpro tunc to Oct. 2, 2006.

As financial advisors, O'Keefe will:

a. assist in the review of reports or filings as required by the Court or the Office of the U.S. Trustee, including schedules of assets and liabilities, statements of financial affairs, and monthly operating reports;

TOWER AUTO: Closure Plans Will Displace 100 Employees in Indiana----------------------------------------------------------------Tower Automotive Inc. and its debtor-affiliates will close theirKendallville, Indiana, plant early next year, costing more than100 employees their jobs, the Associated Press reports.

The city of Kendallville tried to entice Tower to stay, but"there was nothing we could offer in the realm of economicdevelopment to keep them here," Kendallville Mayor SuzanneHandshoe told the AP.

As part of Tower's ongoing strategy to reduce excessmanufacturing capacity and enhance operational efficiency,production from the Kendallville Plant will be consolidated intoother Tower facilities in North America, James A. Mallak, TowerAutomotive's chief financial officer, informs the Securities andExchange Commission.

The timetable for the transition of work will be decided withinthe next few weeks.

According to Mr. Mallak, total estimated costs associated withthe consolidation amount to approximately $19,600,000, which iscomprised of:

TOWER AUTOMOTIVE: Wants Until March 30 to Decide on Leases----------------------------------------------------------Tower Automotive Inc. and its debtor-affiliates ask the U.S.Bankruptcy Court for the Southern District of New York to furtherextend their time to assume, assume and assign, or rejectunexpired nonresidential real property leases through andincluding March 30, 2007.

Anup Sathy, Esq., at Kirkland & Ellis LLP, in Chicago, Illinois,relates that the Debtors are party to more than 20 major facilitylease agreements, including leases for office space locations andkey production centers.

The Leased Facilities will factor heavily into the Debtors'ongoing operational restructuring, Mr. Sathy says. The Debtorsbelieve that they are current on all postpetition obligationsunder the Unexpired Leases.

According to Mr. Sathy, the Debtors have already made significantprogress evaluating the Unexpired Leases. As of Nov. 16, 2006,the Debtors have rejected nine different leases. Mr. Sathy,however, explains that while the Debtors have made substantialprogress, they remain in active negotiations with the landlordsregarding certain of the Leased Facilities and require additionaltime to decide on the Unexpired Leases.

The Debtors reserve their rights to evaluate whether any of theUnexpired Leases are secured financing arrangements. Nothingwill constitute an admission that any of the contracts areproperly categorized as lease arrangements, Mr. Sathy says.

TOWER RECORDS: Files Schedules of Assets and Liabilities--------------------------------------------------------MTS Incorporated, dba Tower Records, and its debtor-affiliatesdelivered their schedules of assets and liabilities to the U.S.Bankruptcy Court for the District of Delaware, disclosing:

Headquartered in West Sacramento, California, MTS, Inc., dba TowerRecords -- http://www.towerrecords.com/-- is a retailer of music in the U.S., with nearly 100 company-owned music, book, and videostores. The Company and its affiliates previously filed forchapter 11 protection on Feb. 9, 2004 (Bankr. D. Del. Lead CaseNo. 04-10394). The Court confirmed the Debtors' plan on March 15,2004.

The Company and seven of its affiliates filed their secondvoluntary chapter 11 petition on Aug. 20, 2006 (Bankr. D. Del.Case Nos. 06-10886 through 06-10893). Richards, Layton & Finger,P.A. and O'Melveny & Myers LLP represent the Debtors. TheOfficial Committee of Unsecured Creditors is represented byMcGuirewoods LLP and Cozen O'Connor. When the Debtors filed forprotection from their creditors, they estimated assets and debtsof more than $100 million. The Debtors' exclusive period to filea chapter 11 plan expires on Dec. 18, 2006.

TRUMP ENTERTAINMENT: Earns $5.8 Million in 2006 Third Quarter-------------------------------------------------------------Reorganized Trump Entertainment Resorts Inc. reported $5.8 millionof net income on $288.3 million of net revenues for the threemonths ended Sept. 30, 2006, compared to $3.2 million of netincome on $277.2 million of net revenues for the same period in2005.

At Sept. 30, 2006, the company's balance sheet showed $2.2 billionin total assets and $1.8 billion in total liabilities.

As of Sept. 30, 2006, the company's accumulated deficit widens to$421.6 million from $427.1 million of deficit at Dec. 31, 2005.

Mark Juliano, the Company's Chief Operating Officer, commented,"We were able to post increases in net revenues and adjustedEBITDA for the quarter, even though the period started out withthe unexpected and unfortunate closure of all Atlantic Citycasinos for three days due to the New Jersey state budget impasse.Of course, the true effects of this closure lasted beyond threedays as it took time for business to return to normal levels. Inaddition, we continued our efforts to streamline management costs.Our unusually heavy entertainment calendar in August led to higherthan anticipated marketing and promotional costs. We expect thesecosts will decrease in future quarters."

James B. Perry, Chief Executive Officer and President, added, "Ourrenovation and development plans for Atlantic City continue tomove forward. The new Taj Mahal tower is under construction andthe first phase to the Taj Mahal promenade is expected to becompleted by the end of the year. We expect to announce our plansfor the next phase of our renovation capital by the end of thisyear."

"We are in the process of implementing the Company's technologyprograms including the hotel yield management system, which willhelp us properly manage and maximize revenue from our hotel rooms,and the enterprise data warehouse, which will allow us tocapitalize on our presence in the Atlantic City marketplacethrough more effective marketing."

"The development initiatives of the Company are also progressing,and we were pleased to announce the appointment of Eric Hausler asour senior development professional last month. We are preparingfor our November 14 hearing with the Pennsylvania Gaming ControlBoard regarding our proposed project in Philadelphia and expect adecision from the regulatory board before the end of the year."

"We are moving forward with the planning process for a possibledevelopment in Diamondhead, Mississippi and are in the process ofevaluating this possible arrangement with Diamondhead CasinoCorporation."

The Company reported that as of Sept. 30, 2006, it had cash of$161.3 million excluding $27.3 million of cash restricted in useby the agreement governing the sale of Trump Indiana. The Companyindicated total debt had decreased by $24.7 million since December31, 2005, to $1,413.3 million at Sep. 30, 2006. Capitalexpenditures through Sept. 30, 2006, were approximately $91.4million and the Company expects capital expenditures for theremainder of 2006 to be approximately $35 million.

During the quarter, lenders approved an amendment to the Company'sCredit Agreement allowing us to defer the delayed draw time on ourterm loan related to the Taj Mahal expansion to May 20, 2007. Inaddition we modified the definition of "EBITDA" for purposes ofcalculating our financial covenants for the next four quarters, toallow for the addition of $8.0 million of foregone EBITDA relatingto the closure of our casino operations in July 2006.

The Court confirmed the Debtors' Second Amended Plan ofReorganization on Apr. 5, 2005, and the plan took effect onMay 20, 2005.

* * *

As reported in the Troubled Company Reporter on Oct. 18, 2006,Moody's Investors Service confirmed Trump Entertainment ResortsHoldings L.P.'s B3 Corporate Family Rating in connection withMoody's implementation of Probability-of-Default and Loss-Given-Default rating methodology.

UNITED PRODUCERS: Creditors' Confirmation Appeals Equitably Moot----------------------------------------------------------------United Producers, Inc., and Producers Credit Corp. filed a joint,and subsequently amended, plan of reorganization. Certain holdersof prepetition judgments against UPI totaling $17 million forfraud, breach of contract, conversion, and Packers and StockyardsAct violations arising out of cattle marketing, objected to theamended plan on numerous grounds, including the assertions thatthe plan had not been proposed in good faith, failed to providethem with more than they would receive in a liquidation underchapter 7, was not feasible, and otherwise was not fair andequitable with respect to the Appellants' class of claims. 11U.S.C. 1 129(a)(3), (7), (11) & (b)(1) and (2). The creditorsalso objected on the basis that the continuance of UPI's currentmanagement, due to their prepetition misconduct which led toAppellants' judgments, was inconsistent with the interests ofcreditors and equity security holders and with public policy. 11U.S.C. 1129(a)(5)(A).

After a confirmation hearing on September 28 and 29, 2005, thebankruptcy court entered an order on September 30, 2005, findingthat the amended plan met all the confirmation standards of theBankruptcy Code and directing the submission of a separateconfirmation order. Subsequently, on October 6, 2005, the courtentered an order confirming the amended plan. The creditorstimely appealed both the September 30 and October 6, 2005 orders,but did not seek a stay of the orders.

In a decision published at 2006 WL 2846842, the United StatesBankruptcy Appellate Panel for the Sixth Circuit says thecreditors' appeal from orders overruling their objections to thedebtors' proposed Chapter 11 plan and confirming the plan overtheir objections had to be dismissed as equitably moot because (i)the creditors had not sought a stay pending appeal, (ii) thedebtors had substantially consummated their plan, and (iii)innocent third parties had relied on implementation of plan.

Headquartered in Columbus, Ohio, United Producers, Inc. -- http://www.uproducers.com/-- offers marketing, financing, and credit services to its member livestock producers in the U.S. cornbelt, southeast, and midwest areas. The company and its debtor-affiliate filed for chapter 11 protection on Apr. 1, 2005 (Bankr.S.D. Ohio Case No. 05-55272). Reginald W. Jackson, Esq. at Vorys,Sater, Seymour and Pease, LLP represented the Debtor in itsrestructuring. When the Debtor filed for protection fromits creditors, it estimated $10 million to $50 million in assetsand debts.

UTSTARCOM INC: Gets Notice of Default from Trustee of 7/8% Notes----------------------------------------------------------------UTStarcom Inc. received notice from the Trustee for the holders ofits 7/8% Convertible Subordinated Notes due 2008, asserting thatfailure to file its Form 10-Q on or before Jan. 9, 2007,constitute and event of default under the Indenture.

The Trustee or the holders of at least 25% in aggregate principalamount of the Notes outstanding would have the right to declareall unpaid principal and accrued interest on the Notes thenoutstanding to be immediately due and payable.

The Company had received a notice from the staff of The NasdaqStock Market indicating that it is not in compliance withMarketplace Rule 4310(c)(14) because it has not timely filed withthe Securities and Exchange Commission its Quarterly Report onForm 10-Q for the quarter ended Sept. 30, 2006.

The notice indicated that due to the noncompliance, the Company'scommon stock will be delisted at the opening of business onNov. 27, 2006, unless the Company requests a hearing in accordancewith the Nasdaq Marketplace Rules.

The Company disclosed that it intends to request a hearing beforea Nasdaq Listing Qualifications Panel to review the Nasdaq staff'sdetermination. The hearing request will stay the delisting of theCompany's common stock pending the Panel's decision.

Previously, the Company announced that it has delayed the filingof the Form 10-Q in order to (i) complete its voluntary review ofits historical equity award grant practices under the direction ofthe Nominating and Corporate Governance Committee of the Company'sBoard of Directors and (ii) assess any impact of the review on theCompany's financial statements related to prior equity grants andthe Company's internal control over financial reporting.

The Company also disclosed that, pursuant to the Indenture, theCompany is required to file with the Securities and ExchangeCommission all reports and other information and documentspursuant to Section 13 or 15(d) of the Exchange Act of 1934, asamended, and provide a copy of the filings to the trustee for theholders of the Notes.

Pursuant to the Indenture, a default by the Company on therequirement becomes an "event of default" (i) if the Trusteenotifies the Company of the default, or (ii) 25% of Holders notifythe Company and the Trustee of the default, and (iii) the Companydoes not cure the default within 60 days after receipt of thenotice.

About UTStarcom Inc.

Alameda, Calif.-based UTStarcom Inc. provides IP-based, end-to-endnetworking solutions and international service and support. Thecompany sells its broadband, wireless, and handset solutions tooperators in both emerging and established telecommunicationsmarkets around the world. The company has research and designoperations in the United States, China, Korea, and India.

The PI Committee also seeks the Court's permission pursuant toSection 107(b) of the Bankruptcy Code and Rule 9018 of theFederal Rules of Bankruptcy Procedure to file its DiscoveryMotion under seal for in-camera review.

In a separate pleading, David T. Austern, the Court-appointedlegal representative for future asbestos claimants in theDebtors' cases, also seeks Judge Fitzgerald's consent to fileunder seal his memorandum in support of the PI Committee'sDiscovery Motion.

The PI Committee wants the Debtors to respond to document requestnumbers 47 and 66 of the Committee's First Set of Requests forProduction of Documents Directed to the Debtors.

Mark T. Hurford, Esq., at Campbell & Levine LLC in Wilmington,Delaware, on the PI Committee's behalf; and Raymond G. Mullady,Jr., Esq., at Orrick, Herrington & Sutcliffe LLP in Wilmington,Delaware, on the FCR's behalf, assert that it is necessary tofile the Discovery Motion and the Discovery Memorandum under sealsince they both contain confidential information relating to:

-- the Debtors' policies regarding the settlement and litigation of asbestos personal injury claims; and

-- the history of personal injury judgments against the Debtors.

The Discovery Documents also contain information that was eitherprovided by the Debtors pursuant to a confidentiality agreement,or obtained in connection with confidential depositionproceedings.

The Company has accepted for purchase 22,413,278 of its commonshares at a purchase price of $35.75 per share, for a total costof $801.3 million.

Shareholders who deposited common shares in the tender offer at orbelow the purchase price will have all of their tendered commonshares purchased, subject to certain limited exceptions, theCompany says.

The Company also said that American Stock Transfer & TrustCompany, the depositary for the tender offer, will promptly issuepayment for the shares validly tendered and accepted for purchaseunder the tender offer.

The number of shares the Company accepted for purchase in thetender offer represents approximately 19% of its currentlyoutstanding common shares.

Headquartered in Dublin, Ohio, Wendy's International Inc.-- http://www.wendysintl.com/-- and its subsidiaries operate, develop, and franchise a system of quick service and fast casualrestaurants in the United States, Canada, and internationally.

* * *

As reported in the Troubled Company Reporter on Oct. 17, 2006,Moody's Investors Service held its Ba2 Corporate Family Rating forWendy's International Inc.

Additionally, Moody's held its Ba2 ratings on the company's$200 million 6.25% Senior Unsecured Notes Due 2011 and$225 million 6.2% Senior Unsecured Notes Due 2014. Moody'sassigned the debentures an LGD4 rating suggesting noteholders willexperience a 54% loss in the event of default.

As reported in the Troubled Company Reporter on Sept. 7, 2006,WXP, which has supplied Werner aluminum log, aluminum stages,scaffolding, planks and other products, sought the Court to allowan administrative claim for $1,173,530 in its favor and requireWerner to promptly pay the claim.

As previously reported the Court allowed a $1,084,685administrative claim against Werner Ladder, in favor of supplierWXP, Inc. The Court also ruled that:

(1) WXP would retain its right to assert an additional $82,355 agreed by the Debtors to be owed WXP for goods sold and delivered and sought by WXP as an administrative claim, but not delivered within 20 days before the June 12, 2006 Petition Date, is an allowable reclamation critical vendor or unsecured claim; and

(2) the Debtors and the Creditors Committee would retain their rights to object to all or any portion of the additional claim.

The Debtors objected to WXP's motion, arguing that pursuant toSections 105(a), 503(b) and 507(a) of the Bankruptcy Code and theCourt's Order dated June 13, 2006, the Debtors are authorized tomake payments on account of prepetition claims of suppliers ofgoods entitled to administrative priority up to a cap amount of$2,000,000. The Debtors also disagreed with the amount of WXP'sclaim.

The Official Committee of Unsecured Creditors also opposed WXP'srequest for immediate payment of its administrative claim.

At March 31, 2006, the Debtors reported total assets of$201,042,000 and total debts of $473,447,000.

WERNER LADDER: Wants to Implement Union Employees' Severance Plan-----------------------------------------------------------------Werner Holding Co. (DE), Inc., aka Werner Ladder Company, and itsdebtor-affiliates seek authority from U.S. Bankruptcy Court forthe Southern District of New York to implement a severance planfor hourly union employees at their facility in Chicago, Illinois,who will permanently lose their jobs.

In 2005, the Debtors decided to transfer their operations fromthe relatively high cost Chicago Facility to their facility inJuarez, Mexico. At the end of the transition, the ChicagoFacility will be closed and substantially all of the employeeswill be terminated. The Debtors anticipate their operationalrestructuring to be completed in the first quarter of 2007.

Currently, there are about 432 hourly employees at the ChicagoFacility, of which 429 are members of the Allied ProductionWorkers Union Local No. 12, AFL, CIO. To insure the continuedproductivity at the Chicago Facility, the Debtors and the ChicagoUnion had entered into a new collective bargaining agreement toreplace their original CBA that expired on July 17, 2006. Thenew CBA took effect on July 18, 2006.

According to Joel A. Waite, Esq., at Young, Conaway, Stargatt &Taylor, LLP, in Wilmington, Delaware, neither the Original CBAnor the Current CBA provided the Chicago Union Employees with acontractual right to severance payments.

Mr. Waite says that pursuant to a Final Settlement andRecommendation dated Aug. 8, 2006, between the Debtors and theChicago Union, the Debtors agreed that in the event of a noticeof mass layoff or plant shutdown under the Worker Adjustment andRetraining Act of 1998, they would negotiate to implement aseverance program for the Chicago Union Employees.

In September 2006, the Debtors notified their employees at theChicago Facility of their intention to cut up to 230 jobs byNovember. In October 2006, the Debtors sent another noticeindicating their intention to eliminate up to 100 additionalemployees beginning Dec. 17, 2006.

Chicago Union Employee Severance Program

Under the Chicago Union Employee Severance Program, as negotiatedby the parties, calculation of the severance payments due at thetime of separation would be done by multiplying the number ofcompleted years of service by the appropriate severancemultiplier.

According to Mr. Waite, the total maximum cost of the ChicagoSeverance Program would be around $751,240 for the 429 ChicagoUnion Employees.

Mr. Waite notes that the Chicago Union Employees are a criticalpart of the operational restructuring that is currently underway,and the most effective way to incentivize them to continueworking for the Debtors is to provide the Severance Payments upontheir termination.

The Debtors also believe that making the Severance Payments tothe employees who will lose their jobs in the near future isnecessary to sustain the morale of the remaining employees whootherwise might leave during the critical stage of the Debtors'bankruptcy cases.

On Nov. 8, 2005, the Court authorized the retention of Frank,Rosen, Snyder & Moss, L.L.P., as special counsel to the Trustee.

According to Sheldon K. Rennie, Esq., at Fox Rothschild LLP, inWilmington, Delaware, Frank Rosen represented the Trustee inconnection with the filing of an action against Patient Safety inthe U.S. District Court for the Southern District of New York forthe collection of a $1,000,000 promissory note issued inconjunction with the Aug. 8, 2001, sale of certain radio assetsby various non-debtor entities to Franklin Capital.

Specifically, Mr. Rennie notes, the non-debtor entities includedWGM, WRN, and WRP. One of the debtor-entities, WinstarCommunications, is the sole shareholder of WCI Capital Corp.,which owns 95% of Winstar New Media, which likewise owns 100% ofthe non-debtor entities, WGM, WRN and WRP. In other words, WCIis the parent company of WGM, WRN and WRP, Mr. Rennie says.

To avoid costly litigation, and without an admission of liabilityon the part of either party, the parties have entered into asettlement agreement and release regarding the settlement of theDistrict Action.

The significant terms of the Agreement are:

(a) Patient Safety will pay the Trustee and her attorneys, Frank Rosen, $750,000, if the entire $750,000 is paid on or before July 2, 2007. Patient Safety will owe $1,200,000, less any payments made, if the entire $750,000 is not paid on or before July 2. The $1,200,000 will be evidenced by a Judgment Promissory Note pursuant to which a Judgment may be entered if there's a default in the payment;

(b) Of the $750,000, the first $150,000 will be paid by Patient Safety to its attorney, Richard J. Babnick Jr., Esq., at Sichenzia Ross Friedman Ference LLP, and held in Sichenzia Ross' attorney trust. Within five business days of the Court's approval of the Agreement, Mr. Babnick will cause the $150,000 held in Sichenzia Ross' attorney trust account to be paid over to Frank Rosen for the benefit of Ms. Shubert, in her capacity as trustee of the parent company of WGM;

(c) Of the remaining $600,000 due after the first $150,000 payment, payments will be made to Frank Rosen -- for Ms. Shubert's benefit -- at the rate of 25% of the gross amount of all equity capital raised by Patient Safety. To effectuate these payments, Patient Safety will deposit 100% of its equity raises in Sichenzia Ross' attorney trust account and the funds from the capital raises, at any given increment, will be disbursed as (i) 25% of the funds to Frank Rosen, and (ii) the remaining 75% of the funds as directed by Patient Safety. The payments must be made to Frank Rosen within five business days after the closing of any capital raise and Sichenzia Ross' receipt of the funds from Patient Safety's capital raises in Sichenzia Ross' attorney trust Account. Each payment will be credited against the $600,000 balance until the balance is paid in full.

However, notwithstanding these provisions, and even if there are insufficient equity raises:

(i) at least $150,000 of the $600,000 balance owed will have been paid to Frank Rosen on Ms. Shubert's behalf, on or before January 1, 2007, and if the First Milestone has not been achieved by January 1, Patient Safety will immediately pay WGM an amount equal to the difference between the amounts previously paid to WGM and the $600,000 balance to achieve this milestone; and

(ii) a second $150,000 of the now remaining $450,000 balance owed will have been paid to Frank Rosen, also for Ms. Shubert's benefit, on or before April 1, 2007, and if the Second Milestone has not been achieved by April 1, Patient Safety will immediately pay WGM an amount equal to the difference between the amounts previously paid to WGM and the $450,000 balance to achieve this second milestone.

Any funds held in Sichenzia Ross' escrow for the benefit of WGM, but not yet distributed to WGM, will be included in calculating whether Patient Safety has satisfied the First and Second Milestones;

(d) To secure the payments, Ault Glazer Bodnar Acquisition Fund will pledge its rights and privileges associated with the first mortgage held on the parcel of land situation in the southwest quarter of the southeast quarter of Section 27, Township 16 South, Range 1 West situated in Jefferson County, Alabama. The Trustee will require a current title insurance report and a property and casualty insurance policy on the property listing her as a loss payee paid for by Patient Safety. The property and casualty insurance policy will be maintained in full force and effect through the time when the entire amount due will be paid to Frank Rosen. Furthermore, once Patient Safety satisfies its payment obligations in full, WGM will release the pledge back to the Ault Glazer. Notwithstanding the Pledge, Patient Safety may sell the Property underlying the first mortgage and apply the proceeds to the payment of amounts owed;

(e) Simultaneously with the execution of the Agreement, the parties will execute a Stipulation of Dismissal of Action, with prejudice, which may be filed without further notice with the District Court; and

(f) The parties irrevocably, unconditionally, and generally release, acquit, and forever discharge each other from any and all claims, provided, however, that nothing will release the parties from any of their duties, covenants, obligations, representations, or warranties under the Agreement.

Mr. Scherf's services while at Parente were crucial to the multi-million dollar lawsuit against Lucent Technologies Inc., Mr.Rennie noted. With Mr. Scherf, the Trustee achieved more than$300,000,000 in the Lucent suit, which is currently on appeal.

The Trustee added she does not want to terminate Parente'sservices. According to Mr. Rennie, the accountants at Parente,specifically Charles Persing, who is also a former executive ofthe Debtors, have specific knowledge and skills required toadminister Winstar's estate.

The Trustee anticipates that Parente and Mr. Persing willcontinue providing services in line with those performed by Mr.Scherf on behalf of the estate while at Parente. The Trusteealso anticipates there may be matters where both firms need to beinvolved, like in connection with the Lucent Appeal.

The Trustee assured the Court there will no duplication of workbetween Parente and ESB.

As the Trustee's accountant, ESB is expected to:

(a) perform general accounting and tax advisory services regarding the administration of the bankruptcy estate;

(b) review and assist in preparing and filing tax returns, and existing or future IRS examinations, among others;

(c) analyze and advise on additional accounting, financial, valuation and related issues that may arise in Winstar's cases;

(d) assist the Trustee's counsel in preparing and evaluating any potential litigation;

(e) provide testimony on various matters; and

(f) perform other appropriate services for the Trustee as requested.

ESB will be paid on an hourly basis at its normal and customaryhourly rates, plus reimbursement of actual, necessary expensesand other charges incurred:

Mr. Scherf attests that ESB does not represent any interestadverse to the Debtors' estates and is a "disinterested person"as that term is defined in Section 101(14) of the BankruptcyCode. About Winstar

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